Frasers Centrepoint Trust holds Q2 DPU steady at 3.04 cents

Frasers Centrepoint Trust's Changi City Point in Changi Business Park.
Frasers Centrepoint Trust's Changi City Point in Changi Business Park.PHOTO: ST FILE

SINGAPORE - Frasers Centrepoint Trust (FCT) reported distribution per unit (DPU) for the second quarter that held steady from the year-ago period despite a dip in revenue.

DPU for the three months to March 31, 2017, came in at 3.04 Singapore cents, almost unchanged from 3.039 cents a year ago.

Gross revenue for the quarter dipped 2.9 per cent to S$45.7 million, due mainly to lower contribution from Northpoint, which is undergoing upgrading works, but partially offset by higher contributions from other properties, said FCT's manager.

Net property income declined 3.3 per cent year on year to S$32.6 million, with higher contributions from Causeway Point and Changi City Point helping to mitigate the lower contributions from other properties in the portfolio.

Net asset value as at March 31 was S$1.93 per unit.

During the quarter, 47 leases accounting for 5 per cent of FCT's total net lettable area (NLA) were renewed at an average rental reversion of +4.1 per cent. Causeway Point, which accounted for 42 per cent of the total NLA of the leases renewed during the quarter, achieved average rental reversion of +6.3 per cent. The overall rental reversion for the six months ended March 31 was 5.7 per cent.

The portfolio occupancy as at March 31 declined to 87.2 per cent from 91.3 per cent in the prior quarter, owing mainly to the planned vacancy at Northpoint in conjunction with the ongoing upgrading. Occupancies at the other properties were comparable with the previous quarter.

FCT's manager disclosed that portfolio tenant sales for the three-month period from December 2016 to February 2017 was 12.1 per cent lower compared with the same period last year. Excluding Northpoint, they were 6.9 per cent lower year on year.

Looking ahead, FCT's manager said leasing interest for the reconfigured areas of Northpoint remains strong. The asset enhancement works are proceeding on schedule and are expected to complete by September 2017.

Although challenges from labour constraints, e-commerce and tepid sales growth remain in the retail sector, FCT's well-located suburban malls are expected to remain resilient, it said.