Sasseur REIT posts 3Q21 EMA rental income slipped amid Covid outbreak in July

Sasseur REIT's Chongqing Liangjiang outlets. Credit: Sasseur REIT investor presentationSasseur REIT's Chongqing Liangjiang outlets. Credit: Sasseur REIT investor presentation
  • Sasseur REIT reports third-quarter EMA rental income slipped after Covid-19 outbreak
  • Tenant sales rose on-quarter despite warm weather
  • Sasseur REIT may benefit from the economic downturn

Sasseur REIT reported Friday its third quarter EMA rental income slipped 1.4 percent on-year to 150.4 million yuan as consumer sentiment took a hit from a large-scale Covid-19 outbreak originating in Nanjing in July.

“Shopper traffic in our outlets was affected due to strict government regulations, including partial lockdown and travel restrictions, to control the Covid-19 outbreak. In addition, the unusually warm weather reaching as high as 35 degree Celsius in September had reduced shoppers’ demand for winter fashion, thus affecting overall sales,” the China outlet-mall REIT said in a filing to SGX.

The income available for distribution grew 9.4 percent on-year to S$23.2 million on lower interest expense, tax and trust expenses as well as a favorable yuan-to-Singapore dollar exchange rate, Sasseur REIT said in a filing to SGX.

The distribution per unit (DPU) for the quarter came in at 1.831 Singapore cents, up 3.8 percent on-year from 1.764 Singapore cents, the filing said.

Sasseur REIT’s four outlet malls in China posted total sales of 996.6 million yuan in the quarter, up 12 percent on-quarter.

Cecilia Tan, CEO of the REIT’s manager, Sasseur Asset Management, said the sales growth was “remarkable” amid the backdrop of the Delta variant outbreak and the warm weather.

She cited proactive measures, including revising the tenant mix, upgrading assets and a special anniversary promotional event in September.

Portfolio occupancy across the four outlet malls rose to 93.7 percent in the third quarter, compared with 92.5 percent in the second quarter, the REIT said.


In its outlook, Sasseur REIT said its outlets are “minimally impacted,” and are operating normally as China has fully vaccinated around 77 percent of its population and the country is taking a zero-tolerance approach to Covid-19.

Vito Xu, chairman of the REIT, said the outlet-mall sector will remain appealing as the economic downturn will push consumers to hunt for bargains and lower conventional retail sales will create more stockpile of inventory for the outlets.

Read Sasseur REIT’s filing for more details of its results.