Suntec Reit Q1 DPU inches up to 2.434 S cents

SUNTEC Real Estate Investment Trust (Suntec Reit) on Wednesday morning reported a slight rise in first-quarter distribution per unit (DPU) to 2.434 Singapore cents from 2.433 cents a year ago.

Gross revenue for the three months ended March 31 declined 1.1 per cent from the year-ago period to S$89.7 million, due to lower convention revenue from Suntec Singapore and lower revenue from 177 Pacific Highway amid the weaker Australian dollar. This was partially offset by higher retail and office revenue from Suntec City.

Net property income slipped by 7.6 per cent to S$58.2 million.

Suntec Reit had a committed occupancy rate of 98.9 per cent for its office portfolio and 97.4 per cent for its retail assets, as at March 31.

Distributable income rose 0.8 per cent year on year to S$65.4 million. This included a capital distribution of S$6.5 million, which was the same amount as the year-ago period. The higher distributable income was mainly due to the continued strong performance of Suntec City, as well as better performance and an additional 25 per cent interest in Southgate Complex. But this was partially offset by higher financing costs and the weaker Aussie dollar.

On April 17, the Reit's manager announced that the office component of 9 Penang Road had been 100 per cent pre-leased to UBS which will occupy all eight floors of office space totalling 381,000 square feet. Fit-out work is expected to commence soon after the temporary occupation permit (TOP), with target occupation in the second half of 2020. Development works are on track and scheduled to complete in the fourth quarter of this year.

Chong Kee Hiong, chief executive of the Reit's manager, said, "With the office component leased to UBS, unitholders will enjoy revenue from the fully leased office space soon after TOP as compared to varied rental commencement by multi-tenancy leases. Its lease tenure will also provide stability of income stream with a potential for growth."

Suntec Reit closed unchanged at S$1.86 on Tuesday.