It ceased to get income support for Crown Plaza Changi Airport.
OUE Hospitality Trust (OUEHT) recorded a slip in its net property income of 1.4% YoY from $29.5m to $29.1m in Q3 2017, an announcement revealed.
The firm’s revenue was also hit with a decrease of 2.2% YoY to $33.2m whilst distributable income fell 5.4% to $23.3m. Distribution per stapled security (DPS) also dropped 5.9% YoY to $0.128.
OUEHT explained that the DPS went down compared to the $0.136 a year ago as the trust no longer receives income support for Crowne Plaza Changi Airport (CPCA), partially mitigated by lower interest expense.
Acting CEO of the REIT manager Chen Yi-Chung Isaac also revealed that the firm’s hospitality portfolio revenue per available room (RevPAR) rose 3.5% to $209 YTD. However, the RevPAR dipped 0.9% YoY in Q3 over lower average room rates due to the competitive environment.
He also noted that CPCA’s RevPAR grew 6.2% YoY to $187 and 9.1% YTD.
“Whilst minimum rent was received as CPCA continued to ramp up its operations, we believe CPCA’s performance will maintain its positive trend,” Cheng added.
For Mandarin Gallery, committed occupancy rose to 96.8% from 94.7% a year ago. However, the property’s revenue and NPI slipped amidst lower rents of $22.7 psf from $22.9 psf in Q3 2017.
“We continue to work closely with our tenants to curate a differentiated offering at the mall, as we balance between maintaining a high occupancy and driving the performance of the asset,” he said.
The firm believes that CPCA will get a boost from the revamp of Changi Airport as well as the opening of Jewel Changi which is linked to CPCA through a pedestrian bridge.
“We will continue to focus on driving the performance of our assets and seeking suitable opportunities from our sponsor and third parties for the growth of the REIT,” the firm said.
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