Mapletree Greater China Commercial Trust's Gateway Plaza (Photo: Mapletree Greater China Commercial Trust)Mapletree North Asia Commercial Trust's Gateway Plaza (Photo: Mapletree North Asia Commercial Trust)

China-focused office and retail REIT Mapletree Greater China Commercial Trust (MGCCT) (SGX:RW0U) has announced a distribution per unit (DPU) of 1.606 Singapore cents for its 2Q FY14/15 spanning 1 July 2014 to 30 September 2014.

The figure represents an increase of 10.4% from the 1.455 Singapore cents paid out in the corresponding period in FY13/14. Gross revenue for the quarter increased by 9.2% to SGD67.4 million while net property income (NPI) grew by 12.5% to SGD55.1 million.

From a half yearly period, MGCCT’s DPU for the period of 1 April 2014 to 30 September 2014 (1H FY14/15) was recorded at 3.162 Singapore cents, an increase of 11.1% over the DPU of 2.845 Singapore cents for the first half of FY13/14, and an increase of 10.5% over the forecast DPU of 2.862 cents made during MGCCT’s IPO in 2013.

MGCCT has attributed the quarter’s results to positive rental reversions at its properties, Festival Walk and Gateway Plaza, as well as the REIT’s cost management strategies.

“During the quarter, we have successfully executed our maiden bond issue of SGD75 million 7-year fixed rate notes at an attractive coupon of 3.2% per annum”, said Cindy Chow, CEO for MGCCT’s manager who added that the REIT is sourcing for yield accretive acquisitions in the Greater China region.

The REIT revealed that its property in Hong Kong, Festival Walk, saw its gross revenue and NPI increasing by 3.6% and 4.3% respectively for the quarter while the property maintains 100% occupancy. Meanwhile the REIT’s property in Beijing, Gateway Plaza, saw gross revenue and NPI growth of 16.6% and 21.3% respectively. The property is 98.6% occupied.

Despite ongoing student protests in Hong Kong, MGCCT has stated that it expects mid to long-term market fundamentals in the territory to continue supporting the retail sector.

“There was minimal impact on Festival Walk during the ‘Occupy Central’ movement as the property is not located within the affected districts”, said the REIT. MGCCT has also said that it does not expect the REIT’s performance to be adversely impacted by the students demonstrations which are taking place mainly in Central and Mongkok.

MGCCT also foresees a tight supply of office space in Beijing and maintains positive outlook for Gateway Plaza in the coming quarters.

Units of MGCCT are currently listed on the Singapore Exchange at SGD0.95.

Mapletree Greater China Commercial Trust Gateway Plaza
Mapletree Greater China Commercial Trust Gateway Plaza is expected to benefit from the tight supply of office space in Beijing for the coming quarters.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.