CapitaCommercial Trust shaken by lower rental income

Now it has less distributable income to share, down to S$51.9m in the third quarter from S$56.2m in the same period last year.

CapitaCommercial Trust Management Limited, the Manager of CapitaCommercial Trust, said this is mainly due to lower rental income following the sales of Starhub Centre and Market Street Car Park as well as negative rent reversions from the expiring office leases this year.

In an announcement it said, “However, robust performance from Raffles City Singapore together with lower property tax payment and interest savings mitigated the decline in income. Distribution per unit (DPU) in 3Q 2011 is 1.83 cents, which is lower than the 1.99 cents last year.”

As at 30 September 2011, the Trust’s portfolio committed occupancy was at 97.2% with Grade A office occupancy at 96.4%. However, office market rents are still lower than that in 2008 when most of the Trust’s leases expiring this year were signed.

CapitaCommercial Trust Management Limited expects negative rent reversions for the Trust’s expiring office leases to continue for the rest of the year through to next year depending on the office market conditions.