By BUSINESS TIMES
SUNWAY REIT Management Sdn Bhd expects to sustain the distributable income for financial year ending June 2013 despite a challenging environment due to the loss of income from the temporary closure of Sunway Putra Mall.
REIT, or real estate investment trust, is like a stock of which investors put their money in a certain property and gain returns from the property such as rental income.
Sunway REIT chief executive officer Datuk Jeffrey Ng said the closure of Sunway Putra Mall due to major refurbishment will be cushioned by healthy growth from its retail and hotel assets as well as interest savings from the capital management programme.
“We are happy to see efforts on capital management programme are coming into fruition and which are expected to result in substantial interest savings in the coming years,” he told reporters here yesterday.
Ng was unveiling Sunway REIT’s net property income for the fourth quarter ended June 30 2012, which rose 16.7 per cent year-on-year to RM75.9 million on stronger assets (retail and hotel) contribution.
The retail segment posted a growth of 14.3 per cent for the quarter under review compared with the previous corresponding period, mainly contributed by Sunway Putra Mall and Sunway Pyramid Shopping Mall.
The hotel segment grew 35.4 per cent year-on-year in the fourth quarter, mainly due to Sunway Putra Hotel and Sunway Resort Hotel & Spa.
On a full financial year basis, net property income rose 22.6 per cent to RM299 million attributed to strong business performance in the retail and hotel segments.
“Sunway REIT is pleased to deliver a strong set of financial results with continuous business improvements in its key assets and we expect retail sales to remain buoyant for the rest of the year supported by traditional strong retail and tourism-related activities in the Klang Valley.”
He added that in maintaining Sunway Pyramid Shopping Mall’s position as Malaysia’s most popular mall, the asset manager will continue to introduce new attractions, higher standards of customer service and aggressive marketing promotions.
The strong business performance in the Sunway Resort Hotel & Spa and Pyramid Tower Hotel was underpinned by Sunway Resort City’s strategic location in Klang Valley and the vibrancy of the township.
Ng said meetings, incentives, conferencing and exhibition business as well as rooms demand from the corporate sector are set to further drive the business performance of the hotels.
He said the business performance of the retail and hotel assets is projected to register healthy growth.
“We will actively seek acquisition opportunities in this financial year.”
Meanwhile, in the office segment, Sunway REIT expects the sector to remain challenging due to the oversupply situation coupled with a softer economic climate.
Ng said the REIT expects the distributable income to be sustained for financial year 2013. Sunway REIT is committed to distribute 100 per cent of its distributable net income for this financial year, he added.
Sunway REIT’s net income for the fourth quarter ended June 30 2012 rose 80.6 per cent to RM278 million from RM154 million a year earlier.
It declared a dividend of 1.89 sen per unit to shareholders, bringing total dividend for fiscal year 2012 to 7.5 sen per unit. It was higher than the 6.6 sen it paid in 2011.
– Malaysia Property News