Soilbuild Reit posts 36.3% fall in Q4 DPU to 0.925 S cent

SOILBUILD Business Space Reit on Wednesday posted a fourth-quarter distribution per unit (DPU) of 0.925 Singapore cent, down 36.3 per cent from 1.451 cents a year ago.

Distributable income fell 24.1 per cent to S$11.7 million for the three-month period ended Dec 31, 2019.

Gross revenue decreased 11.5 per cent to S$22.8 million after contribution from 72 Loyang Way, 2 Pioneer Sector 1 and Solaris took a hit.

Lower revenue from 72 Loyang Way was due to the absence of non-recurring liquidation proceeds from Technics Offshore Engineering of S$3.25 million. But maiden revenue of S$1.6 million from 25 Grenfell Street helped ease the fall in the topline figure.

Net property income fell 14.8 per cent to S$17.4 million.

The Reit also booked a S$10.9 million loss in fair value of investment properties and a property held for sale. This was mainly due to revaluation losses for Tuas Connection, Solaris and 2 Pioneer Sector 1, partially offset by revaluation gains for West Park, Eightrium and Inghams Burton.

Net asset value (NAV) per unit was S$0.59 as at Dec 31, 2019, lower than the NAV per unit of S$0.63 as at Dec 31, 2018.

Portfolio occupancy dipped to 84 per cent from 88.4 per cent in the previous quarter mainly due to the pre-termination of the master lease agreement with NK Ingredients.

Positive rental reversion of 5.6 per cent was recorded for renewals and negative rental reversion of 14.1 per cent was recorded for new leases.

The Reit's weighted average borrowing cost was 3.51 per cent per annum, and its weighted average debt maturity was 2.5 years with a fixed interest rate for 81.9 per cent of borrowings. Aggregate leverage stood at 38.2 per cent as at Dec 31, 2019.

Roy Teo, CEO of the Reit manager, said: "For FY2020, we will continue to work towards improving our portfolio quality through asset enhancement initiatives and recycling of capital through divestment of underperforming assets."

Books close on Jan 31 and distributions will be made on Feb 28.

The counter closed flat at S$0.53 on Wednesday before the results were announced.