The payout from CDL Hospitality Trusts (CDLHT) fell again in the fourth quarter owing to a rights issue last August, but earnings from Singapore are starting to stabilise.

There is also "a lot of headroom for further expansion" now that the divestment of two Brisbane hotels this month has lowered CDLHT's gearing to just over 30 per cent, said Mr Vincent Yeo, chief executive of the trust's managers, yesterday.

He said he is eyeing acquisitions in continental Europe. "Heavy quantitative easing has led to extremely attractive borrowing rates and we have this window of opportunity before the European rates start to pick up.

"At the same time, we are seeing very healthy growth numbers coming out of Europe and, in particular, Germany. These are the best numbers we've seen since the global financial crisis... At the right price, I think Singapore hotel assets would also be good long-term acquisitions."

Extensive asset enhancement plans are also being finalised for the Dhevanafushi Maldives Luxury Resort this year.

In the three months to Dec 31, the trust posted a 5.7 per cent fall in distribution per stapled security (DPS) to 2.83 cents, down from three cents in the same period a year earlier. Gross revenue rose 14.3 per cent to $55.2 million. Net property income (NPI) rose 7.8 per cent to $40.6 million, lifted by fresh contributions from the Lowry Hotel in Manchester, Britain, and Pullman Hotel Munich in Germany. The Lowry Hotel was acquired by CDLHT last May.

Australia, New Zealand and Japan reported lower contributions. The biggest drag came from Maldives, where an increase in new supply outstripped demand. In Singapore, NPI fell 1 per cent to $22.6 million - a better result than expected.

Singapore occupancy was stable at 83.5 per cent, versus 83.6 per cent in the fourth quarter of 2016.

Revenue per available room (RevPAR) rose 1.1 per cent to $155, even as more room supply came onto the market in the fourth quarter with the opening of seven new hotels.

On this year's outlook, Mr Yeo said: "I think the industry expectation across the board is for 2 per cent to 5 per cent RevPAR growth.

"After seeing high growth in supply in the last three to four years, we are now seeing a very benign environment with a compound annual growth rate (CAGR) of 1.4 per cent from 2017 to 2020."

That compares with a CAGR of 5.3 per cent from 2014 to 2017.

For the full year ended Dec 31, DPS was 9.22 cents, down 4.3 per cent from 9.63 cents in 2016. The counter closed unchanged yesterday at $1.82 after results were announced.