Starhill Global Reit says DPU could take major hit from David Jones voluntary administration
Retailer contributed 4.7% of the portfolio revenue; Reit may mitigate DPU impact with gains from recent divestments
Starhill Global Reit announced on November 5 that Australian retailer David Jones has entered voluntary administration, citing the anchor tenant's verbal notice in the David Jones Building in Perth. The Reit has requested confirmation from the tenant, while the landlord has not received any lease termination notice and seeks advice on their rights.
David Jones occupies 95.1% of the property's gross lettable area, generating $9 million annually in lease income, contributing 4.7% to the Reit's total portfolio revenue and 6% to its net property income. On a pro forma basis, if the lease were terminated in July 2025 with no replacement tenant for 12 months, Starhill Global Reit's distribution per unit (DPU) for FY2025/26 would have been $0.0329, compared to the actual $0.0368, representing a potential 10.6% reduction.
The Reit's portfolio committed occupancy could fall to 86.1% if the lease were terminated, from 97.4% as of September 30, 2026. Starhill Global Reit may consider distributing gains from recent divestments to mitigate the impact on DPU. The David Jones Building is valued at $106.4 million, accounting for 3.9% of the Reit's total portfolio valuation.
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