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Lower investment income, weaker hospitality drag down OUE's Q3 revenue
PROPERTY developer OUE on Friday posted a 52.5 per cent drop in third-quarter revenue to S$134.2 million, due to lower contribution from its investment properties, on the back of rental rebates extended to tenants on a targeted basis.
About S$19.9 million of rental rebates have been committed or extended to tenants to-date, it said in its business updates.
Its lower revenue also came on the back of weaker hospitality performance, fewer sale completion of OUE Twin Peaks units, as well as an absence of S$95 million in revenue from the sale of the Nassim Road development project in August 2019.
OUE's earnings before interest and tax, however, rose 41.7 per cent to S$128.1 million, driven mainly by higher contribution from interests in equity-accounted investees, as well as an absence of one-off legal and professional expenses from the merger of two of its Reits and the sale of Oakwood Premier OUE Singapore last year.
Operationally, its Singapore office portfolio remained resilient with committed occupancy levels of between 92.3 per cent and 100 per cent as at end-September 2020. Its Singapore retail portfolio also has committed occupancy above 90 per cent but effective rents have declined as a result of rent rebates extended to tenants.
In Shanghai, its committed office occupancy has increased to 82.8 per cent, notwithstanding weak demand in Grade A office and new office supply in Q3.