SINGAPORE (Nov 2): OUE Commercial REIT Management, the manager of OUE Commercial REIT (OUE C-REIT) announced that 3Q17 DPU dropped 12.9% to 1.15 cents compared to 1.32 cents in 3Q16.
Group revenue for 3Q17 declined 2.1% to $43.3 million from $44.2 million last year.
This was due to lower retail rental income in the quarter arising from a lower occupancy at One Raffles Place Shopping Mall as the REIT’s manager embarked on rebalancing the tenant and trade mix at the mall.
Property operating expenses also increased 3.9% to $9.20 million compared to $8.86 million the previous year.
Hence, net property income was 3.5% lower at $34.1 million compared to $35.3 million, due to higher property tax expenses and leasing commission on the back of significant y-o-y improvement in office occupancy.
Meanwhile, other expenses saw a 61% increase to $483,000 from $300,000 last year.
Due to the absence of performance fees and higher income support drawn in the quarter, 3Q17 amount available for distribution was $17.8 million, 3.4% higher from $17.2 million last year.
As at Sept 30, the REIT’s cash and cash equivalents stood at $49.0 million.
Currently, the REIT’s portfolio includes three prime commercial properties located in Singapore and Shanghai – One Raffles Place and OUE Bayfront in Singapore; Lippo Plaza in Shanghai.
Tan Shu Lin, CEO of the manager says, “The Manager will continue its proactive efforts to retain tenants as well as attract new tenants to ensure that occupancy rates of the properties in OUE C-REIT’s portfolio remain robust, as well as focus on active cost management measures to mitigate any impact of lower committed rents on rental income. We will also maintain prudence and discipline in capital management.”
Units in OUE C-REIT closed 72 cents on Thursday.
