Unit holders of Sabana Shariah-compliant Industrial Reit have had a partial victory, despite their failed attempt at ousting the trust manager at an extraordinary general meeting last month.
Sabana Real Estate Investment Management said yesterday that chief executive Kevin Xayaraj is leaving at the end of the year "to address unit holders' feedback and pave the way for change and new leadership".
The Reit has also agreed to terminate a contentious deal to acquire an industrial property in Changi South Avenue 2, in the light of "continuing feedback from unit holders about the proposed acquisition".
This was in spite of the board's view that "the proposed acquisition would have been beneficial to the long-term interests of Sabana Reit and its unit holders", it added in a stock-exchange filing yesterday.
A group of disgruntled unit holders had campaigned against the trust manager earlier this year, citing their dissatisfaction with the Reit's lacklustre performance and falling distribution per unit (DPU).
It culminated in a showdown at an April 28 EGM when the Reit's sponsor, Vibrant Group, and others holding large blocks of units fended off the challenge to have the manager fired.
AT A GLANCE
$21.98 million (-6.9%)
NET PROPERTY INCOME:
$13.34 million (-12.1%)
DISTRIBUTION PER UNIT:
0.88 cent (-24.1%)
Meanwhile, the challenging industrial property market continued to weigh on the Reit's earnings. The trust manager reported a 4.6 per cent year-on-year drop in income available for distribution, leading to a drop in first-quarter DPU.
DPU for the three months to March 31 was 0.88 cent, down by 24.1 per cent from 1.16 cents posted in the same period a year earlier.
Net property income fell by 12.1 per cent in the first quarter to $13.34 million, from $15.17 million in the previous year.
Gross revenue dipped by 6.9 per cent to $21.98 million.
The trust manager attributed the declines to the loss of contributions from 200 Pandan Loop and 3 Kallang Way 2A, which were divested in the first quarter of last year, as well as lower occupancy of several multi-tenanted properties. Higher property expenses also dragged net property income lower.
Market conditions are expected to stay challenging. "With the onset of economic and political uncertainties in the global economy and oversupply of industrial space, overall rentals are likely to continue to face downward pressure", the trust manager noted.
Quarterly earnings per unit came in at 0.76 cent, down from the restated 0.8 cent a year earlier.
Net asset value per unit was 60 cents as at March 31, markedly lower from 75 cents at the end of December last year.
The unit closed unchanged at 45.5 cents yesterday before the results were announced.