SUNTEC Real Estate Investment Trust's (Suntec Reit) distribution per unit (DPU) increased by 16.2 per cent to 2.045 Singapore cents for its first quarter ended March 31, 2021, from 1.76 cents the previous year.

Gross revenue was up 0.2 per cent on year to S$87.1 million for the quarter, from S$86.9 million. Net property income was up 10.2 per cent to S$59.5 million for the quarter, from S$54 million a year ago. 

This was due to stronger operational performances, the Reit manager said in an exchange filing on Friday. This was driven by contributions from 9 Penang Road in Singapore 21 Harris Street and 477 Collins Street in Australia, along with better performance of Marina Bay Financial Centre Properties.

Distributable income rose 5.4 per cent year on year to S$58.1 million, from S$55.1 million.

The distribution will be paid on May 28, after record date on May 3.

Chong Kee Hiong, chief executive officer of the manager, said that the strong performance of the Reit was driven by the resilience of its office portfolio in Singapore and Australia.

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For its Singapore office and retail portfolios, Suntec saw an occupancy rate of 96.1 per cent and 91.5 per cent respectively. 

The Reit’s weighted average lease expiry stands at 2.96 years. It also saw a slight rise in aggregate leverage to 44.4 per cent as at March 31, 2021 from 44.3 per cent as at Dec 31, 2020. 

With the increased return of workers to offices in Singapore, the Reit manager expects the office portfolio revenue to remain stable, underpinned by strong rent reversions achieved in the past 11 quarters. In addition, rent reversion is anticipated to remain positive for the year with office occupancy in the mid-90 per cent range.

As for its retail portfolio, Suntec City Mall, the manager expects to see improvements in revenue to move towards 2019 levels. Increased footfall, higher tenant sales and occupancy are said to contribute to revenue as the manager forecasts mall traffic to recover to about 80 per cent of 2019 levels by the year end. 

"We are also seeing green shoots of recovery in our retail business as tenant sales at Suntec City Mall recovered faster than footfall in Q1 2021," he added.

Units of Suntec Reit closed flat on Friday at S$1.55.