The industry veteran will be succeeded by his deputy, Mark Rohner, on Jan 1, 2026

 

[SINGAPORE] Hospitality veteran Arthur Kiong will step down as the managing director of Far East Hospitality (FEH), the hospitality arm of   Far East Orchard   : O10 +0.77%. 

 

Kiong will retire from his post on Dec 31, 2025. He will be succeeded by FEH&rsquo s deputy managing director Mark Rohner, who will step up as managing director on Jan 1, 2026.  

 

The moves are &ldquo part of Far East Orchard&rsquo s strategic succession planning for sustainable long-term growth&rdquo , said FEH in a statement on Tuesday (Sep 9). 

 

They also follow an earlier reshuffling of titles that took place on Sep 1. Then, Kiong and Rohner were redesignated from their respective positions as CEO and chief operating officer to their current titles. Their roles and responsibilities have remained the same.  

 

FEH said Kiong has been &ldquo instrumental in driving the brand&rsquo s growth and success&rdquo . He has spent more than three decades in the hospitality industry, and has led FEH for close to 14 years. 

 

He introduced the motto of providing &ldquo Singapore-inspired hospitality&rdquo , which the company said has become the cornerstone of its brand identity.

 

FEH noted that, under Kiong&rsquo s leadership, it has achieved several accolades. For one, seven of its hotels clinched a place on the &ldquo Best of the Best in Singapore&rdquo list at the TripAdvisor Travellers&rsquo Choice Awards in 2024.

 

Upon stepping down, Kiong will assume the role of consultant from Jan 1, 2026, until Apr 30, 2026, to support the leadership transition. 

 

Speaking of his time in the industry, Kiong expressed gratitude at having contributed to hotel companies.

 

&ldquo My tenure at Far East Hospitality has been especially meaningful, and together with the dedicated team, we&rsquo ve redefined our brands (and) expanded into new markets,&rdquo he said. &ldquo I have full confidence in Mark to lead Far East Hospitality to new heights from here on.&rdquo

 

Rohner joined FEH as chief operating officer on Jul 1, 2024. With over 25 years of experience in hospitality, he has held senior positions in real estate investment, asset management and hotel operations.

 

Speaking on Kiong&rsquo s retirement, he said: &ldquo Arthur has established a strong foundation in service excellence and branding, and I look forward to building on these strengths.&rdquo  

 

FEH was formed as a 70-30 joint venture between Far East Orchard and The Straits Trading Company in 2013. Far East Orchard is a member of Singapore private property developer Far East Organization. 

Gross revenue declines 6.8% to S$25.2 million

 

[SINGAPORE] Far East Hospitality Trust&rsquo s (FEHT) net property income fell 8.3 per cent year on year to S$23 million for the first quarter ended March, from S$25.1 million.

 

Gross revenue for Q1 FY2025 decreased 6.8 per cent to S$25.2 million from S$27.1 million. The fall was mainly due to lower master lease revenue from the hotels and serviced residences segments, arising from the absence of major events compared with the same period last year, said its managers on Wednesday (Apr 30).

 

For the hotels segment, revenue tumbled 9.2 per cent to S$18.2 million revenue for the serviced residences segment fell 8.8 per cent to S$2.4 million.

 

However, the stapled group posted stronger performance from the commercial premises segment, where revenue rose 4.9 per cent to S$4.6 million.

 

Weighted average cost of debt was at 3.5 per cent as at Mar 31, down from 4.1 per cent for FY2024, and aggregate leverage stood at 31.2 per cent.

 

In addition, FEHT recorded 57.4 per cent of borrowings on fixed rates. &ldquo A 25 basis point increase or decrease in interest rates on variable rate debt is expected to have an impact of S$800,000 on distribution or about S$0.0004 on distribution per stapled security, based on FY2024&rsquo s taxable distribution,&rdquo said the managers a Q1 business update.

 

Some S$9.7 million of the S$18 million incentive fee received from the divestment of Central Square in March 2023 remains available to cushion any potential increase in interest expenses, they added.

 

Average occupancy for FEHT&rsquo s hotels inched down by 1.4 percentage points for Q1 FY2025 to 79 per cent compared with the same year-ago period.

 

The managers on Feb 20 announced that the stapled security group had entered into a sale and purchase agreement with an unrelated third party to acquire Four Points by Sheraton Nagoya, a freehold, 319-room hotel operated by Marriott International. This is FEHT&rsquo s first overseas acquisition in Japan.

 

Far East Hospitality Trust to acquire Sheraton hotel in Japan for 6 billion yen

FEHT purchased the property at an initial price of six billion yen (S$52.8 million), and the deal was completed on Apr 25. It also acquired a Japanese joint-stock company, which will be the master lessee of the asset, for around 50 million yen.

 

Citing recent and upcoming tourism developments, and data that points to a further recovery in tourism amid an uncertain macroeconomic environment, the managers said their outlook in these respects was &ldquo positive&rdquo .

This comes as the trust&rsquo s investment mandate is set to expand

 

FAR East Hospitality Trust (FEHT) will make its first Japanese hotel acquisition after expanding its investment mandate to global markets and asset classes.

 

Its managers on Thursday (Feb 20) announced that the stapled security group had entered a sale and purchase agreement with an unrelated third party to acquire Four Points by Sheraton Nagoya, a freehold, 319-room hotel operated by Marriott International.

 

FEHT will buy the upscale property at an initial price of six billion yen (S$52.8 million). It is also acquiring a Japanese joint-stock company, which will be the master lessee of the asset, for around 50 million yen.

 

The deal is expected to be completed on Apr 25, 2025.

 

The initial price represents a 23 per cent discount to the hotel&rsquo s value of 7.79 billion yen as at Dec 31, 2024. It is also below the estimated replacement cost of 8.61 billion yen, which includes land value, reconstruction expenses for a new hotel of a similar standard, and incidental costs.

 

If the acquired property achieves certain targets, FEHT will make additional payments of up to 1.75 billion yen in April or May of the years 2026 to 2028.

 

The trust&rsquo s managers said that the acquisition will be funded through yen-denominated debt facilities. After additional borrowings for the deal, FEHT&rsquo s gearing is expected to be around 32.9 per cent.

 

Assuming that the property&rsquo s net operating income has stabilised and that the additional payments are made, the acquisition is expected to be 1.7 per cent accretive to FEHT&rsquo s distribution per stapled security. This is on the basis that the hotel was acquired on Jan 1, 2024, and leased out and operated until Dec 31, 2024, inclusive.

 

The trust&rsquo s managers noted that the hotel is within walking distance of the Chubu Centrair International Airport, and is close to Aichi Sky Expo, Japan&rsquo s fourth-largest exhibition centre.

 

They said: &ldquo Nagoya is the key gateway to Central Japan, which has vast potential for tourism, and where travellers can access interesting destinations such as Nagano, Toyama, Kanazawa and Kyoto.&rdquo

 

They added that the property is still ramping up operations since Japan reopened its borders in October 2022. Last year, international visitor numbers at Nagoya&rsquo s international airport hit only 68 per cent of pre-pandemic levels.

 

Gerald Lee, chief executive of FEHT&rsquo s managers, said: &ldquo Japan is an attractive destination for investments as hotels can be acquired at yields that are well above the borrowing costs.&rdquo

 

While the acquisition represents &ldquo an exciting new growth opportunity&rdquo , Singapore remains the trust&rsquo s core market and foundation for its long-term strategy, he added.

 

Expanded investment mandate

In a separate filing on Thursday, the managers of the stapled security group &ndash which comprises Far East Hospitality Real Estate Investment Trust and Far East Hospitality Business Trust &ndash said they would broaden the investment strategies of their respective trusts.

 

With the flexibility to explore new markets and asset classes, they will widen their pool of investment targets, they said. This could &ldquo bring opportunities to optimise the yield and value&rdquo of FEHT&rsquo s portfolio.

 

They added that including global assets and adjacent lodging asset classes in the investment scope will diversify the trust&rsquo s portfolio and revenue streams. This will mitigate risks arising from market fluctuations and the economic cycles of a single region or sector, they said.

 

Lastly, the managers believe that the expanded mandate will grant FEHT access to a wider range of reputable hospitality operators, which is complementary to its existing portfolio and master lease agreements.

 

Still, the managers said that they will continue to maintain a &ldquo strong core in Singapore&rdquo , even as they broaden their focus to invest overseas.

Distributable income drops 18.2% to S$32.7 million

THE managers of Far East Hospitality Trust : Q5T +0.83% (FEHT) on Wednesday (Feb 12) posted a distribution per stapled security (DPS) of S$0.0208 for the second half ended December, down 4.1 per cent from S$0.0217 in the previous corresponding period.

 

This brings total DPS for FY2024 to S$0.0404, 1.2 per cent lower year on year.

 

The distribution for H2 will be paid on Mar 20, after books closure on Feb 20.

 

Distributable income fell 18.2 per cent to S$32.7 million for the half-year period, from S$40 million in the same period the year before.

 

Distribution to stapled securityholders decreased 3.6 per cent to S$41.9 million mainly due to higher finance costs and a change in the proportion of manager&rsquo s fee paid or payable in the form of stapled securities. This was offset by higher distribution of other gains from the divestment of Central Square, said the managers.

 

The proportion of manager&rsquo s fee paid or payable in the form of stapled securities was reduced from 90 per cent to 60 per cent from Jan 1, 2024.

 

If not for the change in the proportion of the manager&rsquo s fee, distributable income for H2 2024 would have been 4.9 per cent higher at S$34.3 million.

 

Revenue was up 0.2 per cent on the year at S$54.9 million for H2, from S$54.8 million. Net property income (NPI) grew 0.2 per cent to S$49.9 million from S$49.8 million.

 

The slightly higher revenue and NPI came despite the absence of non-recurring revenue from hotels contracted during the Covid-19 pandemic and higher property expenses, said the managers.