Suntec REIT Financial Results Ending 31 Mar 2017

“Notwithstanding the uncertainties in the macroeconomic environment and challenging operating conditions, we are pleased to have delivered a higher distributable income and DPU for the first quarter of 2017. Our asset in Sydney, 177 Pacific Highway, which received practical completion in August 2016, contributed to our robust performance this quarter.”

Mr. Chan Kong Leong, Chief Executive Officer

2.425 cents (1Q 2017)

Suntec REIT 1Q FY17 Distributable Income 3.1% Higher Year-on-Year

1Q FY17 Distribution Per Unit (DPU) of 2.425 cents, 2.3% higher

ARA Trust Management (Suntec) Limited, the manager of Suntec Real Estate Investment Trust (“Suntec REIT”, and the “Manager”), is pleased to announce a distributable income of S$61.8 million for the period 1 January to 31 March 2017 (“1Q FY17”) which was 3.1% higher compared to the quarter ended 31 March 2016 (“1Q FY16”). The distribution per unit (“DPU”) of 2.425 cents for 1Q FY17 was 2.3% higher than 1Q FY16 DPU of 2.371 cents. Suntec REIT’s annualised distribution yield for 1Q FY 17 was 5.6%1.

Mr. Chan Kong Leong, Chief Executive Officer of the Manager, said, “Notwithstanding the uncertainties in the macroeconomic environment and challenging operating conditions, we are pleased to have delivered a higher distributable income and DPU for the first quarter of 2017. Our asset in Sydney, 177 Pacific Highway, which received practical completion in August 2016, contributed to our robust performance this quarter.”

As at 31 March 2017, the Singapore office portfolio achieved an overall committed occupancy of 99.4%. The committed occupancies for Suntec City Office, One Raffles Quay and Marina Bay Financial Centre Properties were at 99.0%, 100% and 99.8% respectively. In Australia, the committed occupancies for 177 Pacific Highway and Southgate Complex (Office) were 100% and 89.7% respectively as at 31 March 2017.

On Suntec REIT’s office performance, Mr. Chan said, “During the first quarter of 2017, we renewed and signed approximately 130,000 sq ft of leases, reducing the 2017 leases expiring to 5.9% of NLA. The committed occupancy for our Singapore office portfolio maintained at a high of 99.4%. We will continue our proactive asset management to maintain our high occupancy level as the Singapore office market is expected to remain under pressure given the impending supply and shadow space.”

“With the new leases signed at Southgate Complex, the committed occupancy for our Australian office portfolio has improved to 97.0%. We expect the occupancy in Australia to strengthen as demand continues to be positive in the Sydney and Melbourne markets amidst the stock withdrawals and low level of new supply.”

For the Singapore retail portfolio, the overall committed occupancy as at 31 March 2017 was 98.3%. Compared against the previous quarter, the committed occupancy for Suntec City Mall improved to 98.4%, while the committed occupancy for Marina Bay Link Mall stood at 97.4%. In Australia, the committed occupancy for Southgate Complex (Retail) was 88.4% as at 31 March 2017.

On Suntec REIT’s retail performance, Mr. Chan said, “Despite the soft retail market, we are pleased to report that Suntec City’s Mall operational performance has improved in 1Q 2017. The overall committed occupancy has increased to 98.4% while footfall increased 7.3% year- on-year. Tenant sales per sq ft has also grown 4.3% year-on-year.”

“We will continue our active tenant adjustments to fine tune the trade mix and further enhance the positioning of Suntec City Mall.”

Mr. Chan also updated, “We are pleased to report that development works for the new Grade A commercial building at 9 Penang Road is currently on track and we have received the Building Plan approval on 31 March 2017.”

For 1Q FY17, Suntec REIT’s gross revenue of S$88.4 million was 12.9% higher year-on-year. This was mainly due to the rental contribution of 177 Pacific Highway which received practical completion in August 2016.

The net property income of S$61.8 million was 14.6% higher year-on-year which was similarly due to the contribution from 177 Pacific Highway.

The debt-to-asset ratio stood at 36.4% as at 31 March 2017 whilst the all-in financing cost was 2.42% for 1Q FY17.

 

Attachments

  • Financials
  • Slides
  • Press release

 

IMPORTANT NOTICE

This announcement is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for units in Suntec REIT.

The value of Units and the income derived from them, if any, may fall or rise. Units are not obligations of, deposits in, or guaranteed by, ARA Trust Management (Suntec) Limited (as the manager of Suntec REIT) (the “Manager”) or any of its affiliates.

An investment in Units is subject to investment risks, including the possible loss of the principal amount invested. Investors should note that they will have no right to request the Manager to redeem or purchase their Units for so long as the Units are listed on the SGX-ST. It is intended that holders of Units may only deal in their Units through trading on the SGX-ST. The listing of the Units on the SGX-ST does not guarantee a liquid market for the Units.

The past performance of Suntec REIT is not necessarily indicative of the future performance of Suntec REIT.

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