Suntec Real Estate Investment Trust (Suntec REIT) has seen a 3.2 percent decline in its distribution income to $46.2 million in the third quarter this year.
Among the assets of Suntec REIT include Suntec City Mall, some office units in Suntec Towers One, Two and Three, and the entire Suntec Towers Four and Five. It also owns Chijmes, Park Mall, a fifth of a joint venture that owns Suntec Singapore International Convention & Exhibition Centre, and a one-third stake in One Raffles Quay.
The REIT’s distribution per unit also slid to 2.5 cents, down 14.3 percent from 2.9 cents a year ago.
Gross revenue jumped 2.1 percent to $63.2 million, while net property income surged 7.6 percent to $50.6 million.
Gross revenue was higher due to higher office revenue seen in Q3, said ARA Trust Management (Suntec) Limited (ARA), the trust’s manager. The trust’s gross office revenue in Q3 reached $30 million, up 4.6 percent from 2009, mainly from the higher rental income from its Suntec City offices.
As of September 30, committed occupancy of Suntec City offices had risen to 98.1 percent from the previous quarter, while the committed occupancy of those at One Raffles Quay and its Park Mall offices was 100 percent and 97.5 percent, respectively. With this, the trust’s overall committed occupancy for its office portfolio improved 98.5 percent.
Yeo See Kiat, chief executive of ARA, said: “I am encouraged by the further strengthening of the Singapore office market. In the nine months of 2010, we have renewed and signed more than 580,000 sq ft of office leases, leaving less than 1 percent of our office portfolio expiring in FY 2010.”
The gross retail revenue of the REIT stood at $33.2 million, or $28,000 lower compared to the previous year, with Suntec City Mall accounting for the majority of the revenue. As of September 30, committed occupancy of Suntec City Mall and Chijmes reached 98 percent and 90 percent, respectively, while Park Mall is fully committed. Overall, its committed occupancy for the retail portfolio is 97.6 percent.
Looking ahead, the trust’s manager expects a further improvement in the real estate sector for the rest of the year, as the pickup in confidence in Singapore’s business climate will continue to support the office market.