Suntec Reit's Q4 distributable income up 7.7 per cent

Singapore - Suntec Reit posted a distributable income of S$69.5 million for the fourth quarter ended December, up 7.7 per cent compared to the previous year. This translates into a distribution per unit of 2.75 Singapore cents, up 6.7 per cent from 2.577 Singapore cents a year ago.

Revenue for the quarter was S$87.54 million up 13.9 per cent. Net property income was up 17.9 per cent at S$62.49 million.

For the financial year ended 2015, the Reit achieved a distributable income of S$252.0 million which was 9.4 per cent higher year-on-year. DPU for the year was 10.002 Singapore cents. Based on the Jan 25 closing price of S$1.52, the distribution yield for FY15 was 6.6 per cent. Distribution yield for FY14 was 6.2 per cent.

For FY15, Suntec Reit's gross revenue of S$329.5 million and net property income of S$229.2 million were 16.7 per cent and 19.6 per cent higher year-on-year respectively. This was due to the opening of Phases 2 & 3 of Suntec City mall and higher contribution from Suntec Singapore.

"In November, we acquired three floors of Suntec strata office space amounting to approximately 38,000 sq ft. We also completed the divestment of Park Mall in December and entered into a joint venture to redevelop the property into a new commercial development. The redevelopment will further unlock the underlying value of the property by enhancing the gross floor area of the site," said Yeo See Kiat, chief executive officer of ARA Trust Management (Suntec), the manager of Suntec Reit.

The committed occupancy for Suntec City mall improved to 98 per cent while Suntec City Office Towers achieved 99.3 per cent committed occupancy as at Dec 31, 2015. The committed occupancy for One Raffles Quay and Marina Bay Financial Centre properties was 99.8 per cent and 99.3 per cent respectively. Park Mall's retail and office committed occupancy was 96.7 per cent and 92.2 per cent respectively as at end December.

The Reit's overall committed occupancy for the office and retail portfolio improved to 99.3 per cent and 97.9 per cent respectively as at Dec 31.

Said Mr Yeo: "We are pleased to report that our office portfolio continued to perform strongly. In 2015, we have renewed and replaced approximately 710,000 sq ft of leases, leaving us with a balance of only 14.9 per cent due to expire in 2016. Looking ahead, we expect the performance of our office portfolio to be stable in 2016.

"Notwithstanding the impending headwinds, with the completion of the asset enhancement works for Suntec City, the retail contribution from Suntec City is also expected to be positive."

As at end December, Suntec Reit's assets under management stood at S$9.3 billion.

Suntec Reit ended trading on Tuesday down one Singapore cent, at S$1.51.

This article was first published on Jan 27, 2016.
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