Starhill Global Reit yesterday reported a 7.1 per cent drop in its second-quarter distribution per unit (DPU) to 1.17 Singapore cents.
This was mainly due to lower net property income (NPI), the effects of straight-line rental adjustments, and higher withholding taxes for Malaysia and Australia properties, said its Reit manager, YTL Starhill Global Reit Management.
Gross revenue fell 3 per cent to $52.46 million, dragged by weaker contributions from offices, disruption of income from ongoing asset redevelopment works at Plaza Arcade in Perth and lower revenue at Myer Centre Adelaide. NPI slipped 2.2 per cent to $40.5 million.
Representing an annualised distribution yield of 5.99 per cent, the DPU is expected to be paid out on Feb 28. Units of Starhill Reit closed unchanged at 78 cents yesterday.
YTL Starhill Global's chief executive Ho Sing noted that the portfolio has been relatively resilient despite challenging market conditions and income disruption from asset redevelopment initiatives.
"Our Singapore retail portfolio revenue has remained stable while new take-up for the office space is encouraging. Our asset enhancement initiatives have come in at an opportune time and are making good progress."
Asset redevelopment works at Plaza Arcade and Lot 10 are on schedule to complete in the first quarter of this year.
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AT A GLANCE
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GROSS REVENUE:
$52.5 million (-3%)
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NET PROPERTY INCOME:
$40.5 million (-2.2%)
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DISTRIBUTION PER UNIT:
1.17 cents (-7.1%)
The second-quarter NPI from the Singapore portfolio, comprising interests in Wisma Atria and Ngee Ann City, fell 2.6 per cent from a year ago to $25.7 million, mainly due to lower occupancies in Singapore offices and higher expenses.
Its Australia portfolio, comprising Myer Centre Adelaide, David Jones Building and adjoining Plaza Arcade in Perth, marked a 12.4 per cent drop in NPI to $7.3 million.
But NPI from its Malaysia portfolio, comprising Starhill Gallery and interest in Lot 10 in Bukit Bintang in Kuala Lumpur, rose 0.8 per cent to $6.7 million, mainly due to the appreciation of the Malaysian ringgit against the Singapore dollar.
Said YTL Starhill Global chairman Francis Yeoh: "Earlier initiatives to rejuvenate the portfolio have been timely, setting Starhill Global Reit in a good position to ride any retail sector upturn," he added.