Starhill Global Reit reports NPI up 8.7% to S$38.5m in Q3

STARHILL Global Reit posted a net property income (NPI) of S$38.5 million for its third fiscal quarter, up 8.7 per cent from S$35.4 million the year before.

Revenue was up 4.2 per cent to S$48.4 million in the quarter ended Mar 31, 2022, from S$46.4 million in the year ago period.

The Reit said the growth was mainly driven by the cessation of rental rebates following the completion of asset enhancement works at its Kuala Lumpur asset, The Starhill, in December 2021. The Reit also lowered rental assistance to tenants. However, this was partially offset by lower revenue contribution from Wisma Atria retail and depreciation of the Australian dollar, it said.

In the 3 months, NPI from its Malaysia properties increased by 68.2 per cent year on year to S$7.4 million.

In Singapore, Wisma Atria's NPI for the 3 months rose 3.2 per cent; that of Ngee Ann City's remained unchanged. They contributed S$9.7 million and S$13 million respectively to the quarter’s income.

NPI from Starhill’s Australia properties charted a yearly decline of 6.4 per cent to S$7.3 million. The Reit also owns assets in Japan and China.

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With further relaxation of Covid-19 measures, the Reit expects its business outlook to improve. Rising costs due to interest rate hikes and higher cost of utilities are partially mitigated by master or anchor leases and interest rate hedges in place, it said. However, it noted that prime rents in Orchard Road declined 2 per cent year on year in Q1 2022. Retail sales (excluding motor vehicles) fell 1.8 per cent year on year in February. 

On the flip side, core CBD Grade A and Grade B office rents respectively rose 5.3 per cent and 0.6 per cent year on year in Q1, as positive leasing momentum continued in the office sector.

In market sectors, 85.9 per cent of the Reit’s revenue last period came from its retail properties; the remaining 14.1 per cent came from offices.

As at Mar 31, Starhill also reported a weighted average lease term of 7.3 and 4.9 years by net lettable area and gross rent respectively.

Units of Starhill Global Reit closed unchanged at 59.5 Singapore cents on Thursday (Apr 28).