Croesus Retail Trust sees 5.2% rise in Q2 DPU on higher mall rents and new acquisitions

SINGAPORE - Recent acquisitions of malls in Japan and the exceptional performance of a particular shopping centre, Mallage Shobu, helped Croesus Retail Trust improve its performance for the second quarter.

The mall operator, whose portfolio assets are in Japan, reported on Tuesday (Feb 14) that revenue for the three months to Dec 31 rose 30.7 per cent to 3.18 billion yen (S$39.7 million).

The trustee manager attributed this to better tenant sales in Mallage Shobu, which is in the Saitama prefecture in Japan. It had higher variable rent there, as well as a compensation from a tenant for early termination, which increased gross revenue.

It also noted that it had acquisitions of new malls last year, including Fuji Grand Natalie in Hiroshima and Feeeal Asahikawa in Hokkaido.

This boosted net property income, which grew 23.2 per cent from the same quarter last year to 1.69 billion yen.

Income available for distribution rose 21.4 per cent to 1.18 billion yen for the quarter, which the company said was partly attributable to the internalisation of the trust's trustee manager.

Distribution per unit (DPU) rose 5.2 per cent from the same quarter last year, growing from 1.72 Singapore cents to 1.81 Singapore cents.

The trustee manager said that from July 1 last year to June 30 this year, the distribution policy of the trust is to distribute 100 per cent of its distributable income. After that, it will distribute at least 90 per cent of its distributable income.

Mr Jim Chang, chief executive officer and executive director of the trustee-manager, said: "In the coming quarters, we remain committed towards growing CRT's portfolio and distributions steadily and sustainably, and will continue to explore viable organic and inorganic opportunities to enhance CRT's value."

The trustee-manager said it is evaluating tenant renewal exercises and asset enhancement initiatives.

A tenant replacement exercise is also underway at Feeeal Asahikawa, which is located in the second largest city in Hokkaido.

"In terms of outlook, we remain cautiously optimistic of Japan's economic recovery," said Mr Jeremy Yong, managing director and executive director of the trustee-manager.

"Though the effects of stimulus policies are still work-in-progress, we believe the outcome will be favourable on the back of unwavering commitment from the Japanese government and its central bank to attain sustainable growth for the country's economy," he added.