SPH REIT's net property income up by 5.4% to $42.2m

Thanks to the higher rental income.

SPH REIT Management announced a 2.1% improvement in gross revenue for the third quarter ending in May. 

For the said quarter, revenue sat at $53m, on the back of higher rental income. Meanwhile, with the proactive management of utility contract and other expenses, net property income of $42m was 5.4% higher in the said quarter compared to last year.

The income available for distribution to unitholders increased by 2% to $35.7m. Distribution per unit was at 1.37 Singapore cents.

Both properties continued to demonstrate resilience, with positive rental reversion and full occupancy. Paragon recorded a moderate rental uplift of 3.6% for new and renewed leases in YTD 3Q17, amidst prevailing headwinds in the retail environment.

The Clementi Mall has completed its second renewal cycle and recorded a positive rental reversion of 3.7%. The mall continued to receive strong endorsement by tenants with retention rate of 89% by NLA.

In conjunction with this renewal cycle, Management reconfigured the spaces at basement and Level 4 to create additional lettable area and introduce a wider range of F&B offerings for its stable base of shoppers. The incremental rental revenue of about $0.8m per year from the reconfiguration would boost effective rental reversion to 6.4%.

SPH REIT has a well-staggered debt maturity profile, with weighted average term to maturity of 2.3 years and gearing level of 25.6% as at 31 May 2017. It registered an average cost of debt of 2.81% p.a. for YTD 3Q 2017, with 85.9% of the total borrowing on fixed rate basis.