Frasers Commercial Trust's China Square (Photo: REITsWeek)Frasers Logistics and Commercial Trust's Cross Street Exchange (Photo: REITsWeek)

Singapore-listed office REIT, Frasers Commercial Trust (SGX:ND8U), announced on 23 October that it has achieved a distribution per unit (DPU) of 9.71 Singapore cents for the full financial year of 2015, representing a year-on-year increase of 14.1%.

“We are pleased that the trust ended the financial year with the highest distributable income to unitholders and DPU since the trust was listed in 2006”, said Low Chee Wah, CEO of the REIT’s manager.

“The distributable income of SGD67.8 million and DPU of 9.71 cents also marked the sixth consecutive year of growth in distributable income and DPU since the completion of the recapitalisation exercise in 2009”, said Low who partly attributed the REIT’s performance to positive rental reversions achieved by its Singapore properties.

Gross revenue of SGD142.2 million for FY15 represents an increase of 19.6% as compared to the previous financial year while net property income (NPI) of SGD101.9 million was up 12.5%.

(4Q FY15) (4Q FY14) Change (%) (FY15) (FY14) Change (%)
Gross Revenue (SGD’000) 37,220 31,828 16.9 142,187 118,838 19.6
Net Property Income (SGD’000) 27,387 23,805 15 101,868 90,554 12.5
Net Property Income (cash basis) (SGD’000) 27,110 23,224 16.7 100,865 87,977 14.6
Distribution income for Unitholders (SGD’000) 18,822 14,986 25.6 67,805 57,260 18.4
Distribution Per Unit 2.52¢(1) 2.21¢ 14 9.71¢ 8.51¢ 14.1

“The good performance was bolstered by the strong performance of Alexandra Technopark as NPI surged 61.1% in FY15 compared to FY14, attributed to the full year contribution from the underlying leases following the expiry of the master lease”, said the REIT in its results announcement.

Average portfolio occupancy rate was at 95.4% with the occupancy rates in Singapore and Australia at 95.0% and 95.9% respectively. The portfolio weighted average lease expiry (WALE) is at 3.5 years - influenced in part by the long WALE of Caroline Chisholm Centre of 9.8 years.The REIT’s weighted average debt maturity was 3.3 years and gearing was at 36.2%.

The REIT has said that it will work to renew leases and improve occupancy in the next financial year given the backdrop of expected slower economic growth. “In FY2016, 17.0% of the total portfolio gross rental income in Singapore will expire”, said Low. “As the average passing rents of these leases are lower than current market rents, positive rental reversions can be expected when these leases are renewed”, he added.

Units of Frasers Commercial Trust ended the trading day 2.2% higher from its previous close to finish at SGD1.39 on the Singapore Exchange.

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.