Frasers Commercial Trust reports 20% rise in distribution per unit for Q1

SINGAPORE - Frasers Commercial Trust (FCOT) achieved strong growth in its financial first quarter ended Dec 31 with major contributions from Alexandra Technopark, trust manager Frasers Centrepoint Asset Management announced on Jan 22.

FCOT, with $1.8 billion worth of commercial properties in Singapore and Australia on its portfolio, saw its net property income rise 15 per cent year-on-year to $25.4 million in the quarter, as revenue grew 23.3 per cent to $35.5 million.

"This marks the first quarter of contribution from the underlying leases of Alexandra Technopark following the expiry of the master lease in August 2014, and this has significantly boosted the trust's performance," Mr Low Chee Wah, chief executive of FCOT's manager, said.

With the expiry of the master lease, tenants are now paying higher rents at Alexandra Technopark, which led to a 66.2 per cent increase in the property's net income.

Meanwhile, occupancy rate across FCOT's portfolio was a healthy 96.6 per cent, with office towers China Square Central and 55 Market Street both fully occupied.

The trust manager also noted that 73 per cent of FCOT's borrowings have been hedged on a fixed interest rate, protecting the trust from upcoming interest rate fluctuations.

Backed by the positive performance, FCOT will pay out 2.46 cents in distribution per unit on Feb 27, up 20 per cent from 2.05 cents in the previous corresponding quarter. Earnings per unit was 2.27 cents.

Looking ahead, Mr Low is optimistic: "The significant increased contribution from Alexandra Technopark following the expiry of the master lease will boost future growth in net property income and distribution per unit.

"With the low passing rents of expiring leases in this financial year, the properties in Singapore will continue to benefit from the uptrend in the Singapore office market."