Friday, April 26, 2013

SINGAPORE - Suntec Real Estate Investment Trust (REIT) yesterday announced a 9.2-per-cent drop in its first-quarter distribution per unit (DPU) as gross revenue slumped because of the partial closure of Suntec City Mall and Suntec Singapore International Convention and Exhibition Centre for asset enhancement work.

For the three months ended March 31, the DPU amounted to 2.228 Singapore cents, down from 2.453 cents in the corresponding period last year, as distributable income fell 8.4 per cent to S$50.3 million. Gross revenue was 32.2 per cent lower at S$49.7 million, while net property income fell 37.4 per cent to S$30.7 million.

Looking ahead, the trust manager is bracing for an easing in office and retail rents amid a challenging operating environment. "Grade A office rents are expected to soften mildly on the back of an uncertain global economic outlook," it said.

But it remained cautiously optimistic, saying: "With Suntec REIT's high committed occupancy of 99.7 per cent, coupled with a balance of only 10.3 per cent of its office leases due to expire in 2013, Suntec REIT is well positioned to ride out the challenges of the office market."

The trust manager said Singapore's retail sector was supported in the first quarter by new store openings by food and beverage operators and retailers, but noted that property consultants had forecast rents to soften in the next six months.

By http://www.todayonline.com