MNACT's NPI down 19.5% to $68.5m in Q1 FY2021

The decline was mainly attributed to rental reliefs granted to tenants.

Mapletree North Asia Commercial Trust (MNACT) saw its net property income (YoY) crash 19.5% YoY to $68.5m in Q1 FY2021, an SGX filing revealed. Gross revenue for the same period likewise fell 10.7% YoY to $93.7m.

The decline was mainly attributed to rental reliefs granted to tenants and a lower average retail rental rate at Festival Walk in Hong Kong, as well as a lower average occupancy at Gateway Plaza.

However, this was partially offset by a higher average exchange rate of HKD, RMB and JPY against SGD in FY2021 and the full-quarter’s contribution from MBP and Omori following the completion of their acquisitions on 28 February.

Finance costs in Q1 FY2021 edged up $1.2m YoY, no thanks to borrowings to partially fund the acquisitions of MBP and Omori, offset by lower net interest costs arising from lower interest rates on floating debts in FY2021 and interest savings from the refinancing of borrowings completed in FY2020.

In Festival Walk, gross revenue and NPI for Q1 dropped 33% and 39.9% YoY respectively, as a result of rental reliefs granted and a lower average retail rental rate. Tenants’ sales and shopper traffic sunk 38.6% and 44.9% YoY respectively from 1 April to 30 June, impacted by the weak retail sentiments and the COVID-19 situation.

To stimulate sales and support tenants, the manager organised a number of marketing and promotional events during the period, which includes a partnership with Deliveroo and an enhanced mobile app featuring a loyalty programme.

Meanwhile, MNACT’s Gateway Plaza posted a gross revenue and NPI decline of 9.8% and 9.7% YoY respectively as its average occupancy rate and average rental rate fell. Sandhill Plaza registered a slight increase in gross revenue and NPI of 1% and 1.2% YoY respectively over the same period.

Further, the acquisitions of MBP and Omori in February contributed to the 96.9% and 61.8% increase in gross revenue and NPI for the trust’s Japan property segment in Q1 FY2021.

The trust expects Festival Walk to face further pressures, whilst their Tokyo and Beijing properties are projected to remain resilient.

As for MNACT’s capital management, the trust said that their liquidity position remains healthy as of 30 June, with both committed and uncommitted credit facilities of $418.5m, after taking into account two facility agreements during the quarter.

The group’s total gross debt outstanding rose to $3.4b from $3.38b a quarter ago, bringing MNACT’s aggregate leverage ratio to 39.6% as of 30 June. The average term to maturity for debt stood at 3.05 years as of 30 June and the interest cover ratio for Q1 FY2021 improved to 3.6 times.