Starhill Global REIT's NPI fell 5.9% to $37.2m in Q2

The contraction was attributed to the enhancement works of the Starhill gallery in Malaysia.

Starhill Global REIT (SGREIT) saw its net profit income (NPI) slip 5.9% YoY in Q2, from $39.5m in Q2 2018 to $37.2m, the company announced. Gross revenue dropped 4.7% from $51m to $48.7m over the same period.

The declines were mainly attributed to lower contributions from Starhill Gallery in Malaysia related to its planned asset enhancement. In particular, the rental rebate extended to the master tenant during the refurbishment period prompted the contraction for the quarter.

The REIT’s income available for distribution for Q2 remained stable at $25.2m. Distribution per unit (DPU) for the quarter also remained unchanged at 1.13 cents.
SGREIT’s Singapore portfolio, comprising interests in Wisma Atria and Ngee Ann City on Orchard Road, contributed 64.8% of total revenue, or $31.6m for the quarter. Retail tenant sales for Wisma Atria property grew 13%.

The company’s Australia portfolio accounted for 22.5% or $11m of the total revenue. Its NPI for the quarter slid 4.8%, mainly due to weaker Australian dollar and lower contributions from Myer Centre Adelaide. This was partially offset by higher contributions from its office portfolio, where occupancy rose to 94.5% by end-2019.

Meanwhile, Starhill Gallery and an interest in Lot 10 in Bukit Bintang, Kuala Lumpur in the company’s Malaysia portfolio posted a $5m revenues, or 10.3% of total revenue.

The balance of SGREIT’s portfolio, consisting of a property in Chengdu, China, and two properties in central Tokyo, Japan saw a 2.3% climb in NPI for the quarter. The properties pitched in 2.4% or $1.1m of total revenue.