Bookmark & Share
OUE Hospitality Trust (OUE H-Trust) posted a gross revenue of S$29.6 million in Q2 2015, representing a 4.6 percent rise from the S$28.3 million seen in the same period a year ago.
At the same time, net property income (NPI) increased by 2.2 percent to S$25.8 million compared to S$25.2 million in Q2 2014.
OUE H-Trust recorded higher revenue and NPI due to additional master lease income from Crowne Plaza Changi Airport (CPCA), said Chong Kee Hiong, CEO of OUE Hospitality REIT Management Pte Ltd.
“This more than offset the lower master lease income from Mandarin Orchard Singapore (MOS) due to the decline in visitor arrivals and the absence of the Food and Hotel Asia conference in April this year.”
This pushed its gross revenue for 1H 2015 to S$58.9 million, up 3.4 percent from S$57 million during the corresponding period last year. NPI also edged up by 1.3 percent to S$51.5 million versus the S$50.9 million in 1H 2014.
However, distributable income for Q2 2015 dropped by 6.6 percent from S$21.6 million to S$20.2 million, while distribution per unit (DPU) fell by 7.3 percent from 1.64 cents to 1.52 cents.
For the first half of the year, distributable income dipped by 4.9 percent to S$41.6 million, while DPU slid by 5.7 percent to 3.13 cents from 3.32 cents a year ago.
According to Credit Suisse, OUE H-Trust’s distribution per unit for 1H 2015 was dragged down by greater finance cost, which soared 46 percent year-on-year mainly because of higher borrowings to fund CPCA’s acquisition. This resulted in a DPU that was below expectations.
Looking ahead, the trust plans to purchase Crown Plaza Extension (CPEX) by the second quarter of next year, later than its previous targeted date of Q1 2016. The property is expected to cost S$205 million and is likely to be partly funded by equity at a proportion of 40 percent based on Credit Suisse’s estimates.
OUE H-Trust also announced that it will continue its asset enhancement programme for MOS, which started in end-2013. It involves renovating the remaining 270 guest rooms out of 430 and is being funded by its sponsor OUE Limited.
Image: OUE H-Trust’s Crowne Plaza Changi Airport
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
Related Articles:
Millennium & Copthorne acquires Liverpool hotel