Sunday, July 22, 2012

Fortune Reit results break records

Straits Times: Sat, Jul 21

FORTUNE Real Estate Investment Trust (Reit), which owns 16 retail properties in Hong Kong, achieved record-breaking results during the first half of the year.

Revenue and net property income for the six months ended June 30 rose by 20.3 per cent and 19.6 per cent to a historical high of HK$537.4 million (S$87 million) and HK$382.1 million, respectively. These represented some of the highest growth rates recorded in its nine years of operating history.

ARA Asset Management, which manages Fortune Reit, attributed this to the strong rental reversions across its enlarged portfolio, the additional income generated by the two new properties acquired in February as well as remarkable returns from the completed asset enhancement initiatives (AEIs).

'The successful execution of the three core growth strategies - active leasing management, yield-accretive acquisition and AEIs - has contributed to Fortune Reit's success,' ARA said.

Income available for distribution jumped by 24.9 per cent to HK$268.3 million, with distribution per unit (DPU) for the half year up 23.6 per cent at 15.82 Hong Kong cents. DPU will be paid out on Aug 29.

The interim DPU represents an annualised distribution yield of 6.9 per cent based on a unit price of HK$4.60, which is the average of the two closing unit prices in Singapore and Hong Kong as at June 29. Portfolio occupancy remained healthy at 96.5 per cent.

Meanwhile, a strong rental reversion of 20.6 per cent was recorded for renewals, which was a significant improvement from 13.8 per cent for the same period last year. Consequently, passing rent for the original portfolio went up by 11.5 per cent.

Looking ahead, ARA noted that retail sentiment in Hong Kong remained positive, as the total value of retail sales in Hong Kong from January to May rose by 13.5 per cent compared with the same period last year.

'Fortune Reit's portfolio of 16 private housing estate retail properties will continue to benefit from the strong retail environment,' it said.

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G) | | | |

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