Hektar REIT’s portfolio consists of a regional shopping centre and five established neighbourhood-focused shopping centres in the Northern, Central and Southern Regions of Peninsular Malaysia.

The Manager aims to enhance the long-term value of the portfolio via key operating, investment and capital management strategies. The performance achieved by each centre in the latest financial year is set out in this section.

Property Subang Parade Mahkota Parade Wetex Parade Central Square Kulim Central Segamat Central
State Selangor Melaka Johor Kedah Kedah Johor
Title Freehold Leasehold* Freehold Freehold Freehold Leasehold**
Primary trade area (Population) 1,834,000 382,200 201,600 406,870 287,694 190,000
NLA (retail) 523,487 sq ft 521,142 sq ft 175,014 sq ft 310,564 sq ft 299,781 sq ft 211,910 sq ft
Tenancies (NLA lots only) 89 90 60 45 67 33
Occupancy 82.5% 87.1% 89.9% 85.9% 94.0% 67.3%
Visitor traffic 4.0 million 2.8 million 1.9 million 1.9 million 1.9 million 0.7 million
Acquisition price RM 280.0 million RM 232.0 million RM 117.5 million RM 83.0 million RM 98.0 million RM 104.0 million
Valuation RM 423.0 million RM 323.5 million RM 142.0 million RM 90.0 million RM 129.0 million RM 57.0 million
Gross revenue RM 30.4 million RM 28.1 million RM 12.7 million RM 8.5 million RM 13.3 million RM 3.5 million
NPI RM 17.2 million RM 11.4 million RM 6.7 million RM 3.7 million RM 8.4 million (RM 0.5 million)
  • * until 2101; ** until 2116. Data as at 31 December 2021.

Portfolio diversification

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  • * Numbers may not add up to 100% due to the negative NPI obtained by Segamat Central.

Occupancy

The portfolio recorded an overall occupancy rate of 84.9% as at 31 December 2021, down from 2020, as the retail industry continued to be impacted by the disruptions from the COVID-19 pandemic. Hektar REIT continues to implement rental reviews and rebate offers to support eligible tenants and implement strategic marketing initiatives to drive traffic back to our malls.

Occupancy as at 31 December.
Property 2021 2020
Subang Parade 2021: 82.5% 2020: 83.7%
Mahkota Parade 2021: 87.1% 2020: 92.5%
Wetex Parade 2021: 89.9% 2020: 94.5%
Central Square 2021: 85.9% 2020: 87.9%
Kulim Central 2021: 94.0% 2020: 93.9%
Segamat Central 2021: 67.3% 2020: 77.9%
Overall* 2021: 84.9% 2020: 88.4%
  • * The weighted average occupancy rate is calculated based on NLA.

Visitor traffic

Overall visitor traffic decreased to 13.2 million visits in 2021, impacted by the implementation of mobility restrictions through out the year to curb the COVID-19 pandemic in Malaysia.

Note: Figures rounded up.
Property 2021 2020
Subang Parade 2021: 4.0 million visits 2020: 4.9 million visits
Mahkota Parade 2021: 2.8 million visits 2020: 4.5 million visits
Wetex Parade 2021: 1.9 million visits 2020: 2.5 million visits
Central Square 2021: 1.9 million visits 2020: 2.8 million visits
Kulim Central 2021: 1.9 million visits 2020: 3.0 million visits
Segamat Central 2021: 0.7 million visits 2020: 1.5 million visits
Total 2021: 13.2 million visits 2020: 19.2 million visits

Tenancy mix

The largest rental contributors to the portfolio are tenants from the departmental store and the food & beverage segments. Both segments contributed 45% of the portfolio’s total rental income. In terms of NLA occupancy, department stores and supermarkets continue to dominate the portfolio by taking up 40% of all available NLA.

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  • * Based on monthly rental income for December 2021.
  • Numbers may exceed 100% due to rounding up.

Top 10 tenants

The top ten tenants in the portfolio contributed approximately 37.7% of total monthly rental income, providing a diversified revenue base. Aside from the top tenant, Parkson, which contributed approximately 11.7% of monthly rental income, no other tenant contributed more than 10%.

Tenant Trade sector NLA % of total NLA % of monthly rental income*
1 Parkson Department Store/Supermarket 252,515 sq ft 12.4% 11.7%
2 The Store Department Store/Supermarket 273,198 sq ft 13.4% 8.8%
3 GSC Leisure & Entertainment/Sports & Fitness 88,670 sq ft 4.3% 2.5%
4 MR. D.I.Y. Homewares & Furnishing 74,301 sq ft 3.6% 2.4%
5 Seleria Food Court Food & Beverage/Food Court 42,105 sq ft 2.1% 2.4%
6 Watson’s Health & Beauty 11,965 sq ft 0.6% 2.3%
7 Guardian Health & Beauty 12,164 sq ft 0.6% 2.1%
8 Giant Superstore Department Store/Supermarket 72,140 sq ft 3.5% 2.0%
9 MM Cineplexes Leisure & Entertainment/Sports & Fitness 75,928 sq ft 3.7% 1.8%
10 KFC Food & Beverage/Food Court 15,792 sq ft 0.8% 1.7%
Top 10 tenants (by monthly rental income) 918,778 sq ft 45.0% 37.7%
Other tenants 1,123,120 sq ft 55.0% 62.3%
Total 2,041,898 sq ft 100.0% 100.0%
Top 10 tenants (by monthly rental income)
918,778 sq ft NLA 45.0% of total NLA 37.7% of monthly rental income*
Other tenants
1,123,120 sq ft NLA 55.0% of total NLA 62.3% of monthly rental income*
Total
2,041,898 sq ft NLA 100.0% of total NLA 100.0% of monthly rental income*
  • * Based on monthly rental income for December 2021.

Rental reversions

For the year ended 31 December 2021, the portfolio recorded 121 new and renewed tenancies, with an overall weighted average negative rental reversion of 7.0% on the back of rental reviews and rebate offers implemented by the REIT to support eligible tenants in the current challenging retail environment.

Property No. of new tenancies / renewals NLA % of total NLA % increase / decrease over previous rent rates
Subang Parade 17 new tenancies / renewals 168,116 sq ft NLA 32.1% of total NLA -12.6% change over previous rent rates
Mahkota Parade 30 new tenancies / renewals 136,514 sq ft NLA 26.2% of total NLA -11.2% change over previous rent rates
Wetex Parade 24 new tenancies / renewals 125,230 sq ft NLA 71.6% of total NLA 6.4% change over previous rent rates
Central Square 12 new tenancies / renewals 148,771 sq ft NLA 47.9% of total NLA 3.7% change over previous rent rates
Kulim Central 11 new tenancies / renewals 148,644 sq ft NLA 49.6% of total NLA 6.2% change over previous rent rates
Segamat Central 27 new tenancies / renewals 74,024 sq ft NLA 34.9% of total NLA -30.1% change over previous rent rates
Total / average 121 new tenancies / renewals 801,299 sq ft NLA 39.2% of total NLA -7.0% change over previous rent rates
Total / average of rental reversions
121 new tenancies / renewals
801,299 sq ft NLA
39.2% of total NLA
-7.0% change over previous rent rates
  • Figures as at 31 December 2021.

Tenancy expiry profile

A total of 291 tenancies will expire in 2022 representing approximately 34.2% of NLA and 55.1% of monthly rental income as at 31 December 2021. The management’s strategy is to continue tenancy remixing exercises by refreshing the tenant mix as tenant contracts expire. Key tenancies are secured with options to renew and are usually confirmed six months prior to their expiry.

For year ending 31 December 2022 2023 2024
No. of tenancies expiring 291 50 43
NLA of tenancies expiring 698,353 sq ft 596,002 sq ft 440,421 sq ft
NLA of tenancies expiring as % of total NLA 34.2% 29.2% 21.6%
% of total monthly rental income* 55.1% 25.5% 19.4%
  • * Based on monthly rental income for December 2021.

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Tenancy provisions

As at 31 December 2021, turnover rent provisions were present in 91% of tenancy contracts within the portfolio. Step-up rent provisions were present in 20% of tenancy contracts within the portfolio.

A turnover rent provision allows for rent calculated as a proportion of monthly or yearly turnover of the tenant’s business. Turnover rent is paid to the REIT if it exceeds the base rent specified in tenancy agreements on a monthly or yearly basis. A step-up rent provision stipulates pre-determined increases in rent at defined intervals during a tenancy agreement.

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