Hektar REIT’s 2Q NPI rises 9.5%, announces 1.21 sen distribution

PETALING JAYA (Aug 20): Hektar Real Estate Investment Trust’s (Hektar REIT) net property income (NPI) rose 9.5% year-on-year to RM17.36 million in the second quarter ended June 30, 2026 (2QFY2026), as lower property operating expenses lifted its NPI margin.

Revenue was broadly unchanged at RM31.92 million from RM31.99 million a year earlier. Property operating expenses fell 9.8% to RM14.56 million from RM16.13 million, lifting NPI margin to 54.4% from 49.6%.

In a Bursa Malaysia filing on Thursday (Aug 20), the REIT said net income increased 33.6% to RM6.23 million from RM4.66 million in 2QFY2025. The result included a RM2.65 million fair-value gain on investment properties, compared with no such gain in the corresponding quarter.

Excluding the unrealised fair-value gain, realised income fell 23.1% to RM3.58 million from RM4.66 million. Trust expenses rose to RM5.87 million from RM3.51 million, while finance expenses increased to RM7.88 million from RM7.62 million.

Hektar REIT announced an interim income distribution of 1.21 sen per unit for 2QFY2026, amounting to RM8.58 million. The distribution will go ex on Sept 9, with the entitlement date on Sept 10 and payment on Oct 9. It is taxable.

For the first half ended June 30, revenue was broadly flat at RM62.94 million, while NPI rose 5.8% to RM32.64 million from RM30.86 million. Realised income, however, declined 6.7% to RM8.23 million from RM8.82 million.

The manager attributed the decline in first-half realised income primarily to RM2.5 million in one-off administrative expenses incurred in connection with corporate initiatives during the period. It said higher occupancy, tenant remixing and cost optimisation supported the improvement in NPI.

Retail assets generated RM58.11 million, or 92.3% of first-half revenue, while the education asset contributed RM4.83 million, or 7.7%.

As at June 30, investment properties stood at RM1.48 billion, up from RM1.41 billion at end-2025. Total secured borrowings rose to RM662.48 million from RM603.85 million, while net asset value increased to RM747.41 million, or RM1.0537 per unit, from RM744.55 million, or RM1.0497 per unit.

The manager said completed acquisitions are expected to contribute additional lease income in the coming quarters.

Separately, two proposals remained pending as at the report date: the proposed RM26 million acquisition of a 90% equity interest in Terramark Sdn Bhd, and the proposed RM125 million acquisition of the leasehold interest in part of a land parcel in Setapak, together with existing buildings and a new building to be constructed for KYS KL East International School.

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