Frasers office REIT sees 0.4% decline in DPU for 3Q 2017 on lower occupancies

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Frasers Commercial Trust has announced a distribution per unit (DPU) of 2.40 Singapore cents for its 3Q 2017, which is a decrease of 0.4% compared to the 2.41 cents achieved in the corresponding period of 2016.

The REIT’s distributable income to unitholders for the period was SGD19.2 million (USD14.1 million), a 0.9% increase from 3Q 2016.

“The quarter’s gross revenue of SGD38.3 million for 3QFY17 was 0.6% lower than for 3QFY16, mainly due to lower occupancy rates at Alexandra Technopark, China Square Central, and Central Park”, said the REIT, in a statement on the results.

“However, gross revenue for the Australian properties for 3QFY17 was up 5.3% year-on-year mainly as a result of the stronger Australian dollar”, it added.

The REIT’s portfolio occupancy rate of 92.6% as at 30 June 2017 has improved compared to the 91.8% as at 31 March 2017.

The income weighted average lease expiry (WALE) of the portfolio was 3.4 years as at 30 June 2017.

“Looking ahead, risks and challenges will be present in the markets”, said Jack Lam, CEO of the REIT’s manager.

“In light of this, we will continue to proactively undertake initiatives and measures that will strengthen the resilience and defensiveness of the [REIT] going forward”, he added, pointing to the on-going SGD45 million upgrading and repositioning of Alexandra Technopark as an example.

Units of Frasers Commercial Trust are currently listed on the Singapore Exchange at SGD1.425.

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Ridzwan Rahmat has been analysing Singapore-listed REITs and business trusts, since 2008. For disclosure purposes, Ridzwan is currently vested in Mapletree Greater China Commercial Trust, Mapletree Industrial REIT and Mapletree Logistics Trust.

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