Sasseur REIT posts 4Q21 EMA rental income slipped as Covid hit outlet mall sales

Chinese yuan (renminbi) notes. Photo by Eric Prouzet on UnsplashChinese yuan (renminbi) notes. Photo by Eric Prouzet on Unsplash

China outlet mall investor Sasseur REIT reported Friday its entrusted management agreement (EMA) rental income for the fourth quarter fell 0.5 percent on-year to 158.4 million yuan, as outlet sales were lower.

The variable component of EMA rental income dropped 6.8 percent on-year in the three months ended 31 December to 52.9 million yuan, the REIT said in a filing to SGX.

Total outlet sales in the quarter were 6.8 percent lower on-year due to Covid-19 outbreaks in other China cities affecting shopper traffic and due to slower sales of winter clothing on warmer-than-usual weather, the REIT said.

However, the appreciation of the yuan against the Singapore dollar on-year helped to bolster rental income, Sasseur REIT said.

The distribution per unit (DPU) for the quarter came in at 1.9 Singapore cents, down 1.8 percent from 1.935 Singapore cents in the year-ago quarter, Sasseur REIT said. That was after S$2.2 million of the income available for distribution in the quarter was retained to fund asset enhancement initiatives (AEI) and for working capital purposes, the REIT said.

“Sasseur REIT has grown from strength to strength since listing and has performed remarkably well against a challenging and uncertain economic backdrop, as well as a fairly volatile operating environment in China in the last two years of the global pandemic,” Cecilia Tan, CEO of Sasseur Asset Management Pte. Ltd. (SAMPL), the REIT’s manager, said in the statement.

Full-year results

For the full year, EMA rental income rose 5.5 percent on-year to 611.9 million yuan, while the DPU came in at 7.104 Singapore cents, up 8.5 percent from 6.545 Singapore cents in 2020.

Total outlet sales in 2021 climbed 12.3 percent on-year, the REIT said.

“The REIT continued to see robust consumption trends in the cities where its outlets are located, coupled with intensive promotional efforts in close collaboration with tenants which led to the higher sales,” Sasseur REIT said.


Sasseur REIT issued a positive outlook, despite citing slower economic growth in China.

“Despite slower economic growth, we believe outlet business remains appealing due to its unique positioning as a value-for-money shopping destination. Sasseur REIT’s outlets are well-positioned and will continue to benefit from China’s dual circulation policies which promote domestic consumption,” the REIT said.

The dual circulation policy involves focusing more on the domestic market, or internal circulation, while relying less on exports, or external circulation.