Parkway Life Reit Q3 DPU drops 8.8% on absence of one-off divestment gain

SINGAPORE - Parkway Life Real Estate Investment Trust (PLife Reit) reported an 8.8 per cent fall in distribution per unit (DPU) to 3.06 Singapore cents for the three months to Sept 30 from 3.36 cents for the year-ago quarter, due to the absence of a one-off divestment gain.

DPU from recurring operations however continued to grow, rising 2.7 per cent year on year in the third quarter.

Gross revenue for the quarter rose 8.2 per cent to S$28.1 million mainly due to contribution from one nursing home acquired on March 31, higher rent from the properties in Singapore and the appreciation of the Japanese yen.

Net property income rose 8 per cent to S$26.2 million.

Following the completion of the asset enhancement initiative (AEI) of Sawayaka Kiyotakan in Japan, rent is expected to increase by 4.7 per cent for the remaining lease term of approximately 17 years with effect from July 26. This is the ninth AEI for the group's Japan portfolio and fourth AEI with its largest nursing home operator, KK Sawayaka Club.

Said Mr Yong Yean Chau, CEO of the Reit manager: "We are committed to improving the performance of the group through a robust asset enhancement strategy. Since listing, we have devoted substantial effort to implementing asset enhancement initiatives with the aim of unlocking the value of our properties and developing them to their full potential."

He added: "This has been a tough year for the economy as investors are faced with uncertain market conditions and increased volatility.

"While we do expect some challenges in acquisition opportunities in the short to medium term, we continue to remain optimistic about PLife Reit's prospects in the medium to longer term."