Paragon Reit posts DPU of S$0.0172 in latest 4-month period

PARAGON Real Estate Investment Trust : SK6U 0% (Reit), previously known as SPH Reit, declared a distribution per unit (DPU) of 1.72 Singapore cents for the four months ended Dec 31, 2022, unchanged from a year ago. 

This represents an annualised yield of 5.7 per cent, said the Reit in a business update on Monday (Feb 13), and puts the DPU for the 16 months ended Dec 31, 2022, at 7.24 Singapore cents. 

The distribution will be paid on March 28, 2023.

The Reit had in July 2022 announced a change to its financial year-end from Aug 31 to Dec 31, resulting in a 16-month FY2022 (16M FY2022) between September 2021 and December 2022. After which, its financial year would return to a 12-month period ending on Dec 31 each year.

Gross revenue for 16M FY2022 came in 1.8 per cent higher than the previous corresponding 16-month period at S$376.4 million, while net property income rose 3.3 per cent to S$279.9 million. The portfolio occupancy rate stood at 98.5 per cent, while tenant retention ratio was 80 per cent. 

Paragon Reit also posted an improvement in rental reversion rate to -4.1 per cent in 16M FY2022, from -8.4 per cent in the corresponding previous period, mainly due to recovering retail sentiment. Weighted average lease expiry stood at 5.2 years by net lettable area and 2.8 years by gross rental income. 

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The Reit attributed its boost in performance to a return of travel and leisure demand, as pandemic restrictions eased. This resulted in “increased visitation and spending”, with its Singapore portfolio seeing a 24 per cent jump in tenant sales and footfall, said the Reit manager. 

Sentiment was weaker in Australia, with footfall decreasing by 1 per cent due to pandemic restrictions in the country. Still, most of Australia’s social distancing requirements had eased in early 2022, resulting in a 7 per cent hike in tenant sales.

Susan Leng, chief executive officer of Paragon Reit, said: “As we return to normalcy, our operating metrics in terms of tenant sales and footfall continue to improve.”

“We will continue to proactively manage our assets and work closely with our stakeholders to ensure that we remain at the forefront of evolving retail and consumer trends.” 

Paragon Reit ended Monday at S$0.97, up S$0.005 or 0.52 per cent, before the release of the business update.