KUALA LUMPUR (April 26): Pavilion Real Estate Investment Trust (Pavilion REIT)’s net property income (NPI) rose 13% to RM89 million in the first quarter ended March 31, 2018, from RM78.97 million in the previous year’s corresponding quarter.
Gross revenue for the quarter grew 11% year-on-year to RM131.51 million from RM118.94 million, as rental income grew 7% year-on-year to RM104.4 million on higher contribution from Pavilion Kuala Lumpur Mall's tenants following a repositioning exercise, and higher occupancy rate at the Intermark Mall.
The group also noted that its other income grew 26% y-o-y during the quarter to RM27.11 million from RM21.6 million, supported by higher revenue rent from Pavilion Kuala Lumpur Mall and fees received from DA MEN’s electricity provider to Pavilion REIT, for collecting the charges incurred by tenants in DA MEN Mall.
Distributable income for the quarter totalled RM69.7 million or 2.29 sen per unit, compared with 2.32 sen per unit a year ago, as the REIT's units in issue grew to 3.035 billion.
Meanwhile, the REIT noted that its manager’s management fee incurred during the quarter increased RM400,000 y-o-y, in line with the increase in total assets value and net property income.
Borrowing cost incurred during the quarter was also higher by RM1.2 million amid drawdown of additional borrowings for acquisition of investment properties and working capital purposes.
The REIT said it spent approximately RM400,000 of its capital commitment during the year for landscaping, signage improvements and tenancy lots enhancement at DA MEN Mall.
Going forward, the REIT expects the retail environment to continue to be challenging. “Marketing efforts will persist to drive traffic to retail malls and encourage spending. Overall, Pavilion Kuala Lumpur Mall has shown improvement in its results after the repositioning exercise of the tenants,” it added.
Pavilion REIT closed unchanged at RM1.44, giving it a market capitalisation of RM4.4 billion. — theedgemarkets.com