Suntec Reit posts 16.9% rise in Q1 DPU amid higher contributions

SUNTEC real estate investment trust’s (Reit) distribution per unit (DPU) rose 16.9 per cent year on year to S$0.02391 for its first quarter ended Mar 31, 2022, from S$0.02045 a year ago.

Gross revenue was up 13.9 per cent to S$99.2 million for the quarter, from S$87.1 million a year ago.

This was due to new contributions from The Minster Building in London, and higher contributions from Suntec City Office and Suntec City Mall, its manager said in a bourse filing on Tuesday (Apr 26).

With improved outlook across the portfolio, it said capital distribution that was put on hold due to the pandemic has also resumed. Net property income (NPI) grew 24.9 per cent on the year to S$74.3 million for the quarter, from S$59.5 million.

Distributable income rose 18.2 per cent year on year to S$68.7 million, from S$58.1 million.

Chong Kee Hiong, chief executive officer of the Reit’s manager, said that the office portfolio in Singapore, Australia and the United Kingdom  (UK) remained resilient, with the Singapore office portfolio achieving positive rent reversion for 15 quarters.

“We are now more optimistic about the continued recovery of the retail and convention businesses compared to a year ago,” he added. “At Suntec City Mall, occupancy improved to 96 per cent, as more F&B and activity-based tenants were introduced to attract shoppers. Suntec Convention losses had narrowed with higher revenue and strict cost control.”

Adding to the quarter’s improvement is the absence of performance fees paid to the fund manager for 9 Penang Road in Q1 21 from its joint venture (JV) income. 

While its Singapore office portfolio benefited from lower sinking fund contributions at its Suntec City Office as well as higher occupancy and rent from its JV, its retail portfolio enjoyed higher occupancy and rent at Suntec City Mall. 

However, the NPI of its Australian portfolio and the JV income there declined due to lower occupancy and a weaker Australian dollar. 

Over in the UK, apart from income contribution from The Minster Building, the acquisition of which was completed on July 28, 2021, retail rent concessions from its JV were also lower.

The distribution will be paid out on May 30, after the record date on May 6.

Units of Suntec Reit closed flat at S$1.83 on Monday.