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Mapletree North Asia Commercial Trust Q1 DPU up by 3.7% to 1.95 S cents

MAPLETREE North Asia Commercial Trust’s manager has bumped up the trust’s first-quarter distribution per unit to 1.95 Singapore cents, or 3.7 per cent higher than the year prior.

Net property income was up by 10.7 per cent to S$85 million for the three months to June 30, according to unaudited results out on Monday. Distributable income was higher by 9.3 per cent, at S$62 million.

Gross revenue rose by 11.1 per cent to S$104.9 million, on higher rental income from the trust’s three Chinese assets: Festival Walk shopping centre in Hong Kong; the Beijing office building Gateway Plaza; and Sandhill Plaza, a business park in Shanghai.

The trust also bought six other office buildings in Japan in May 2018, which contributed to the showing.

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The portfolio’s weighted average lease expiry, by gross rental income, was 2.6 years as at June 30. Meanwhile, occupancy stood at 99.1 per cent, down from 99.6 per cent as at March 31.

Gearing for the trust was a shade higher at 36.9 per cent, against 36.6 per cent as at end-March, with an average term of 3.46 years to debt maturity.

In its outlook statement, the manager warned that weak demand for office space in Beijing, as well as a growing pipeline of new office stock, “continue to pose challenges to both rental and occupancy levels” at Gateway Plaza.

Hong Kong’s Festival Walk is expected to stay resilient on sound retail market fundamentals, despite economic headwinds, a slightly dwindling footfall and ongoing anti-Beijing protests, while Sandhill Plaza should deliver a steady performance, the manager added.

Still, it expects the new Japanese properties - in Tokyo, Yokohama and Chiba - to provide the trust with a stable income, based on long average lease expiries and high average occupancy.

Cindy Chow, chief executive of the manager, also said in a statement that the trust “has delivered a set of steady results, notwithstanding the rising headwinds from the ongoing trade and political tensions, and the slowing down of global economic growth”.

The counter shed S$0.03, or 2.13 per cent, to S$1.38, before the results were released.