EC World Reit sees lower Q1 DPU due to rental rebates given to tenants

THE distribution per unit (DPU) for EC World Real Estate Investment Trust (EC World Reit) fell by 22.9 per cent on the year to 1.158 Singapore cents for the first quarter ended March 31. 

This is largely due to rental rebates provided to tenants in March, amid the coronavirus crisis. In April, the Reit's manager announced rental rebates amounting to about 23.7 million yuan (S$4.74 million). Without the rebates, DPU would have been 1.529 cents. 

The manager said it also retained 5 per cent of the amount available for distribution "for the sake of prudence and maintaining financial fluidity". 

It added that while the Covid-19 situation has stabilised and improved in China, with economic activities and production resuming gradually, "significant macroeconomic uncertainties" are likely to persist in the near term.

Total amount available for distribution declined 17.9 per cent year on year to S$9.79 million. 

Gross revenue dipped 1.4 per cent year on year to S$23.5 million, while net property income was roughly steady at S$21.1 million. The manager said that the impact of the rental rebates was partly mitigated by growth within the portfolio and contributions from Fuzhou E-Commerce, which was acquired last August. 

The Reit's portfolio comprises seven assets in Hangzhou and one in Wuhan, the epicentre of the virus outbreak. 

The manager said that as at end-March, the operations of its tenants and underlying operations of its master leases had restarted and were "mostly back to normal".