Tower REIT falls short in net trust income for Q1

TheStar Wed, Oct 14, 2020 08:40am - 6 months ago


“However, net trust income for the current quarter decreased by 23.2% compared to the corresponding quarter in the preceding year mainly due to higher interest expense and the one off expenses related to the acquisition of Menara Guoco, ” it said in a filing with Bursa Malaysia

PETALING JAYA: Tower Real Estate Investment Trust (REIT) saw its first-quarter net trust income falling to RM1.57mil from RM2.04mil in the same quarter a year ago.

This is despite gross revenue for the quarter, which ended on Sept 30, rising to RM6.51mil from RM5.66mil a year ago.

Tower REIT said there was a rise in manager’s fees, administrative expenses and interest expenses that led to the fall in net property income.

It said revenue increased due mainly to the additional revenue generated by the newly acquired investment property, Menara Guoco.

“However, net trust income for the current quarter decreased by 23.2% compared to the corresponding quarter in the preceding year mainly due to higher interest expense and the one off expenses related to the acquisition of Menara Guoco, ” it said in a filing with Bursa Malaysia.

It also noted that the current quarter’s pre-tax profit of RM1.57mil was about the same as the immediate preceding quarter.

The trust said the increase in contribution from Menara Guoco had been offset by the lower occupancy in Menara HLX.

The quarter under review had seen it complete its acquisition of Menara Guoco.

“With the diversified tenant base across a broader range of sectors, the manager is expecting that it will further contribute to the stability of Tower REIT’s income, ” it said.

On its outlook moving forward, Tower REIT said the Covid-19 pandemic may see demand and rental rates for office sector being subdued.

It also noted that the demand remained strong for office spaces in selected strategic locations in the Klang Valley.

Tower REIT said it would continue to take active steps to manage the portfolio in order to maximise returns to its unitholders.






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