CapitaLand Commercial Trust’s net property income drops by 4.5% to $51.4m in 2Q

Blame it on higher operating expenses.

Higher leasing commissions and property tax led to a lower net property income for CapitaLand Commercial Trust, along with a lower gross revenue of $67.6m for 2Q.

According to a press release by CapitaLand, its DPU of 4.36 cents was a 1.9% increase year-on-year, while higher contributions from CCT’s 40.0% and 60.0% interests in CapitaGreen and Raffles City Singapore respectively, resulted in a y-o-y rise in distributable income for 2Q 2016 by 1.0% and for 1H 2016 by 2.2%.

“The better performance was achieved notwithstanding lower gross revenue of S$67.6 million for 2Q 2016 and S$134.4 million for 1H 2016 due to lower occupancies in a few buildings,” the press release said.

Meanwhile, the release added that the Trust’s portfolio valuation increased by 0.4% over a six-month period due to generally higher net property income achieved compared to appraisers’ assumptions in the December 2015 valuation exercise.

“RCS Trust, a sub-trust which holds Raffles City Singapore, has borrowings of S$641.7 million (CCT’s 60.0% interest) due on 21 June 2016 which were entirely refinanced with unsecured bank facilities. Raffles City Singapore is now unencumbered,” the press release said.