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

Mapletree Greater China Commercial Trust has announced a DPU of 1.778 Singapore cents for its 3Q FY 16/17, a fall of 4.1% from the 1.854 cents reported in the corresponding period of the previous financial year.

Gross revenue for the quarter declined 0.5% year-on-year to SGD87.8 million, while net property income (NPI) fell by 1.5% SGD71.4 million.

Correspondingly distributable income slipped by 2.8% to SGD49.5 million.

“While overall performance was affected by the implementation of Value Added Tax [VAT] and incremental property tax payable for Gateway Plaza, the portfolio remained resilient with increased contributions from Festival Walk and Sandhill Plaza”, said Cindy Chow CEO of the REIT’s manager,

The office and retail REIT’s aggregate portfolio occupancy rate improved from 95.7% a quarter ago, to 98.6% as of 31 December 2016, with a weighted average lease expiry (WALE) of 2.5 years by gross rental income.

Its gearing ratio has also increased to 40.5% as at 31 December 2016, from 39.5% in March 2016, but average all-in cost of debt has been reduced from 2.89% to 2.78%.

“Looking ahead, [Mapletree Greater China Commercial Trust’s] performance at Gateway Plaza remains affected by additional property tax arising from the change in property tax basis and implementation of VAT by the local authorities”, said the REIT in an assessment of the coming quarters.

The REIT also noted that weak global growth, and volatility in the financial markets, are likely to persist.

“The manager will stay focused on proactive asset management to enhance and/or unlock the value of our properties, pursue accretive acquisitions as well as actively monitor and manage interest rate and foreign exchange exposure to deliver long term, sustainable returns to unitholders”, said the REIT.

Units of Mapletree Greater China Commercial Trust finished the trading day about 0.5% lower from its previous close on the Singapore Exchange to end at SGD0.955.

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.