Starhill Global REIT's Wisma Atria (Photo: REITsWeek)

Starhill Global REIT has reported a DPU of 1.18 Singapore cents for its 3Q 16/17, a decrease of 6.3% from the 1.26 cents achieved in the corresponding period of 2016.

Gross revenue for the period fell by 0.6% year-on year to SG53.3 million (USD38 million) while net property income slid 0.9% from the previous corresponding period to SGD41.2 million.

Correspondingly distributable income for the quarter declined by 6.3% year-on-year to SGD25.7 million.

Starhill Global REIT has attributed the weaker numbers to disruptions in revenue resulting largely from the mall repositioning in China, as well as lower contributions from Wisma Atria Retail, its Singapore offices, and Myer Centre Adelaide.

The REIT’s Singapore portfolio, comprising interests in Wisma Atria and Ngee Ann City on Orchard Road, contributed 62.5% of total revenue, or SGD33.3 million in 3Q FY16/17.

“The retail environment continues to be challenging as retailers face both structural and cyclical changes”, said Tan Sri Dato’ (Dr) Francis Yeoh, Chairman of the REIT’s manager.

“However, amidst the uncertainties, the global economies are showing signs of a turnaround. We have taken a strategic stance to ready ourselves for the recovery by rejuvenating some assets in our portfolio, and seeking out new opportunities both domestically and regionally so as to create value and strengthen long-term sustainable income for our unitholders”, he added.

The REIT’s committed portfolio occupancy as at 31 March 2017 was at 96.6%, while gearing was maintained at 35.3% with 99% of borrowings effectively on fixed rates.

Starhill Global REIT finished the trading day unchanged from its previous close on the Singapore Exchange to end at SGD0.775.

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.