SASSEUR Real Estate Investment Trust (Sasseur Reit) posted a distribution per unit (DPU) of 1.838 Singapore cents for its third quarter ended Sep 30 – a 0.4 per cent increase year on year and its highest Q3 distribution in four years.

Although the Reit’s entrusted management agreement (EMA) rental income fell 2.1 per cent year on year to S$30.8 million, its distributable income for the quarter rose 1.2 per cent to S$23.5 million.

In a business update on Friday (Nov 11), the Reit’s manager said the increase in distributable income was due mainly to an income tax refund of S$2.1 million relating to Chongqing Liangjiang Outlets. 

The fixed component of the trust’s EMA rental income also rose by 3 per cent to 108.6 million yuan (S$21 million) in Q3 FY2022, from 105.5 million yuan in the same period the year before. This helped partially offset the fall in the variable component of the EMA rental income, which declined by 3.3 per cent year on year to 43.4 million from 44.9 million yuan.

According to the Reit’s manager, the variable component income fell due to temporary closures of two of its shopping outlets in China, as a result of Covid-19 outbreaks. In addition to reduced traffic, Chongqing Liangjing Outlets and Chongqing Bishan Outlets also had to shorten their opening hours in August 2022 to ration energy consumption amid extreme weather conditions.

EMA rental income for the first nine months of 2022 was 0.4 per cent higher year on year at S$94.3 million. 

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Distributable income remained unchanged at S$68.6 million, while DPU for the nine-month period rose 0.8 per cent on-year to 5.248 cents.

Sasseur Reit : CRPU 0%’s occupancy portfolio of 96.9 per cent is also its highest in four years, added the manager. The trust’s weighted average lease expiry stands at 2.7 years.

The Reit has a debt headroom of S$896.7 million, with 70.9 per cent of its borrowings hedged to fixed interest rates or pegged to China’s stable interest rate. 

The distribution will be paid out on Dec 28 after books closure on Dec 12.

Units of Sasseur Reit finished 0.7 per cent or S$0.005 down at S$0.71 on Thursday.