MENU

These 3 REITs Have Delivered A Weaker Performance In Their Latest Quarterly Earnings

The earnings season has more or less ended. There were some real estate investment trusts that managed to show growth while there were some that did not.

In here, let’s take a look at three REITs that had delivered a weaker performance in their latest earnings for the quarter ended 30 September 2016 (the REITs are presented in no particular order):

1. First up is Frasers Centrepoint Trust (SGX: J69U), which owns six suburban shopping malls in Singapore. These malls include Causeway Point, Northpoint, and Changi City Point.

The REIT also holds a 31.2% stake in the Malaysia-listed Hektar Real Estate Investment Trust (H-REIT).

During the quarter, Frasers Centrepoint Trust’s gross revenue declined 6% whilst its net property income (NPI) dropped by 0.9% compared to the same quarter last year. With that, the REIT’s distribution per unit (DPU) came in at 2.815 cents, down 1.5% year-on-year.

Frasers Centrepoint Trust’s top-line fell mainly due to lower revenue from Northpoint and Changi City Point. The former is undergoing a two-phase asset enhancement initiative (AEI) which is expected to be completed by September 2017. The latter is having a changeover in its anchor tenant.

The REIT’s overall portfolio occupancy is currently 89.4%, a decline from the 96.0% seen a year ago.

2. The next REIT on the list is Keppel REIT (SGX: K71U). It has a focus on commercial properties and its portfolio currently consists of eight office assets located in Singapore (four) and Australia (four).

The REIT reported that its property income was down by 6.3% year-on-year, which resulted in a 5.4% decline in net property income. The REIT’s income available for distribution fell too, by 3.6% to S$52.5 million. Consequently, Keppel REIT’s distribution per unit (DPU) declined by 5.9% from 1.70 cents a year ago to 1.60 cents.

Although the Keppel REIT’s financial numbers had mostly fallen across the board, the REIT’s operational numbers had showed some improvement. For instance, its portfolio occupancy level at the end of the third quarter of 2016 was 99.5%, up from the 98.5% seen a year ago.

3. Lastly, we have Mapletree Greater China Commercial Trust (SGX: RW0U).

The REIT has three properties in China and Hong Kong and they are namely, Festival Walk (in Hong Kong), Gateway Plaza (in Beijing), and Sandhill Plaza (in Shanghai).

Mapletree Greater China Commercial Trust ended its reporting quarter with an overall portfolio occupancy of 95.7%, down from the 98.4% seen the year before.

Furthermore, the REIT expects its results for its current fiscal year to be affected by an additional property tax arising from the change in property tax basis and Value Added Tax imposed by the local authorities at Gateway Plaza.

During the reporting quarter, Mapletree Greater China Commercial Trust also saw its gross revenue and net property income decline by 1.9% and 3.2%, respectively.  Its distributions per unit (DPU) also ticked downwards by 2.4% from 1.81 cents to 1.77 cents.

If you like what you've seen, you can get even more investing insights and analyses from The Motley Fool's weekly investing newsletter Take Stock Singapore. It's FREE, so do check it out here.

Also, like us on Facebook to follow our latest news and articles. The Motley Fool's purpose is to help the world invest, better.

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.