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EC World Reit to give out 23.7m yuan in rental rebates; key management and board take 10% pay cut
EC World Real Estate Investment Trust (EC World Reit) on Friday said it would provide about 23.7 million yuan (S$4.8 million) in cash rental rebates to tenants within its portfolio to help them cushion the adverse impact of the current Covid-19 crisis.
Key management personnel including its chief executive, chief investment officer and deputy chief financial officer will take a 10 per cent reduction in remuneration for the three months leading to June 2020.
Similarly, fees for its board directors will also be reduced by 10 per cent for the same three-month period.
The Chinese logistics Reit manager expects the rental rebates to be one-off in nature, barring any further unforeseen material deterioration of the Covid-19 situation in China, it said in a statement.
Tenants at the Reit’s Hangzhou assets have reported a slowdown resulting from a shortage of employees and the extension of the Chinese New Year break; its tenants in the Wuhan Meiluote in Wuhan, Hubei, were unable to continue with operations as a result of the lockdown, which lasted until March 22.
Any rental rebates provided to Forchn Holdings Group, the sponsor of EC World Reit, will be regarded as interested person transactions (IPT). The amount in rental rebates regarded as IPTs amounts to 20.4 million yuan, or 0.6 per cent of EC World Reit’s latest net tangible assets.
“More time will be needed for EC World Reit’s assets to resume full-operational capacity and for business demand to return to pre Covid-19 levels, given the significant uncertainty of the global Covid-19 situation,” the company said.
Units of EC World Reit closed down 3.5 Singapore cents, or 6.31 per cent, to finish at 52 cents on Friday before the announcement.