There was progress on all fronts, says analyst.
OCBC Investment Research noted:
Suntec REIT delivered a good set of 3Q12 results, in our view. Despite the partial closure of Suntec Singapore and Suntec City Mall for Phase 1 of the asset enhancement works (AEI) and divestment of Chijmes, NPI and distributable income showed only a 19.5% and 6.3% YoY decline to S$38.4m and S$52.8m respectively.
DPU, on the other hand, dipped 7.2% to 2.35 S cents, coming in ahead of our projection. For 9M12, DPU totalled 7.164 S cents (-3.9%), forming 78%/77% of our/consensus full-year DPU forecasts. No proceeds from Chijmes sales, we note, were used to cushion the fall in 3Q DPU.
The office segment continued to be the star performer in 3Q, registering a 10.3% YoY growth in revenue to S$31.4m amid positive rental reversions. In particular, Suntec City Office achieved its second consecutive quarter of full occupancy. This helped to maintain the overall office occupancy at 99.9%.
Leasing demand had also been strong, as evidenced by the average contracted rent of S$8.96 psf pm secured for the quarter (vs. S$8.71 in 2Q). With only 1.6% and 19.7% of its total office leases expiring in FY12 and FY13, we expect its office performance to remain positive, which should alleviate the weakness at its retail segment (-25.3% in 3Q revenue).
Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G)
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