Starhill Global REIT fiscal 2Q net property income falls, missing Daiwa forecast

Starhill Global REIT mall Wisma AtriaStarhill Global REIT mall Wisma Atria. Note: Photo taken pre-Covid

Starhill Global REIT reported net property income for its fiscal second quarter fell 2.4 percent on-year to S$39.5 million as higher contributions from the Singapore offices were offset by declines in the Singapore retail portfolio’s contributions and the depreciation of the Australian dollar.

Gross revenue for the quarter ended 31 December declined 2.7 percent on-year to S$51.0 million, it said in a filing to SGX after the market close on Tuesday.

The distribution per unit was 1.13 Singapore cents, down 3.4 percent from 1.17 Singapore cents in the year-ago quarter, the filing said.

Daiwa had forecast net property income of S$41.2 million on revenue of S$53.1 million, with a DPU of 1.16 Singapore cents.

The REIT said it retained around S$500,000 of distributable income for working capital needs, which impacted DPU.

Overall occupancy of the portfolio improved to 96.6 percent as of 31 December as the Myer Centre Adelaide office property saw a doubling of occupancy to 74.8 percent after obtaining a new anchor tenant, it said. The Singapore office portfolio’s committed occupancy rose to 93.6 percent at end-December, from 89.4 percent a year earlier, it said.

The Singapore retail occupancy was 99.2 percent at end-December despite intense competition, retail-space oversupply and soft consumer sentiment, it said.

For the fiscal first half, Starhill Global REIT reported net property income of S$79.9 million, down 2.3 percent on-year, on gross revenue of S$103.1 million, down 2.3 percent on-year. DPU for the six-month period was 2.28 Singapore cents, down 3.8 percent from 2.37 Singapore cents in the year-ago period, it said.

In the outlook, Francis Yeoh, chairman of YTL Starhill Global, the REIT manager, pointed to concerns over a “challenging” macro economic outlook.

Yeoh added that the REIT was looking at ways to “reinvigorate” the Starhill Gallery property in Kuala Lumpur following the completion of a new MRT station in the area.

Starhill Global REIT’s portfolio has 10 properties across Singapore, Australia, Malaysia, China and Japan.

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