CFA Society Singapore
SINGAPORE (Oct 20): The manager of CapitaLand Commercial Trust (CCT) has declared a distribution per unit (DPU) of 2.36 cents for 3Q17, up 2.6% from 2.30 cents a year ago on lower operating expenses, stronger performance from CapitaGreen as well as a one-off gain.
However, the trust is estimated to have an adjusted DPU of 2.02 cents, up 6.9% from 1.89 cents in 3Q16, after taking into consideration an enlarged units base with an additional 513 million CCT units following its rights issue.
Gross revenue in 3Q17 fell 0.4% to $74.1 million over the quarter from $74.4 million in the previous year, due to the absence of income following CCT’s divestments of its 50% stake in One George Street in June, as well as its divestments of Golden Shoe Car Park and Wilkie Edge in July and Sept respectively.
Net property income (NPI) rose 2.7% to $58.6 million from $57 million a year ago on the back of lower operating expenses such as property tax.
Distributable income grew 7% to $73.1 million from $68.3 million a year ago, due to stronger performance from CapitaGreen as well as a $3.3 million top-up for the loss of distributable income arising from the divestments of One George Street and Wilkie Edge.
In its outlook, the manager of CCT says it expects lower NPI in FY18 at selected properties in CCT’s current portfolio, due to flow-through of negative rent reversions of leases committed in 2017 and potentially continued negative rent reversions in 2018.
“CCT has delivered a positive set of results this quarter, with portfolio committed occupancy rate at 98.5% as at end September 2017, well-above the market rate of 92.5%. This excludes the occupancy rate of Asia Square Tower 2 as the acquisition will only be completed in November 2017,” says Lynette Leong, CEO of the manager.
“Our latest acquisition is strategic and timely as it comes at the bottom of the Grade A office market rent cycle,” she adds.
Units in CCT closed flat at $1.66 on Thursday.