FCT – BT

FCT distributable income down 6% in Q1

FRASERS Centrepoint Trust (FCT) has announced income available for distribution of $10.4 million for its first quarter ended Dec 31, 2008, which is 6 per cent lower than a year ago.

Distribution per unit (DPU), however, was 1.67 cents, higher than 1.61 cents previously, as DPU for the latest quarter was based on 100 per cent of FCT’s income available for distribution compared with 90 per cent in year-ago quarter.

FCT said that gross revenue for the quarter ended Dec 31, 2008 was $19.5 million, a decrease of 3.2 per cent over the corresponding period last year, mainly due to the planned vacancies at Northpoint as part of the additions and alteration work to re-position the mall. The decrease was partially offset by the higher rental rates for new and renewed leases achieved in Causeway Point and higher turnover rent.

It said that it continued to make positive rental reversions with the bulk of the rentals of new and renewed leases during the quarter contributed by Causeway Point, which showed an average increase of 18.9 per cent from the preceding period. The occupancy rate had improved from 87.7 per cent as at Sept 30, 2008 to 88.7 per cent as at the end of the December quarter.

Actual property expenses for the quarter ended Dec 31, 2008 were $6.7 million, higher than the previous corresponding period by $0.5 million or 7.5 per cent, mainly due to higher property tax and staff costs. Net property income for the December quarter was $12.8 million, which is $1.1 million or 8 per cent lower than the same period last year.

Commenting on the outlook, FCT said that its property portfolio is suburban in nature, located next to key transportation hubs, catering to local/regional needs where there are no or limited alternative shopping choices. Suburban malls have their own population catchment.

During the current economic conditions, FCT’s portfolio of suburban malls will likely provide defensive cashflow.