Soilbuild REIT saw its distribution per unit (DPU) fall 6.3% to 1.466 cents in the second quarter ended June. This was partly due to payment of property management and lease management fees in cash instead of units.
“2Q17 DPU came in within our expectations at 25.6% of full-year forecast,” says Ong in a Monday report.
Meanwhile, the group reported a 10.1% increase in gross revenue to $21.6 million in 2Q, making up 25.2% of OCBC’s full-year forecast.
Soilbuild REIT’s portfolio occupancy also increased to 92.6%, from 91.8% in end-1Q17. In 2H17, 7.6% of Soilbuild REIT’s portfolio NLA is up for renewal.
See: Soilbuild REIT 2Q DPU falls 6.3% to 1.466 cents
According to Ong, the biggest challenge for Soilbuild REIT comes from its 72 Loyang Way asset.
“Loyang is the wild card,” says Ong. “The security deposit received for 72 Loyang Way has been fully utilised during the quarter.”
Occupancy at 72 Loyang Way increased to 22.8% in 2Q, up from 9.9% in the preceding quarter. Ong notes that JTC has given Soilbuild REIT the approval to lease out up to 30% of the property’s gross floor area to non-oil and gas related tenants.
“We currently project that the 30% of the space will successfully be leased out by FY18, while the other 70% of the NLA will remain unoccupied till FY20,” says Ong.
Units of Soilbuild REIT closed flat at 74 cents on Monday.
