KUALA LUMPUR: MRCB-Quill REIT (MQREIT) posted a net loss of RM24.38 million for the fourth quarter ended Dec 31, 2019 (Q419) compared with a net profit of RM8.05 million a year ago mainly due to a change in fair value of investment properties.
It recorded gross revenue of RM40.62 million, a decrease of 2.9% compared with RM41.81 million in Q418, mainly due to lower revenue generated from Wisma Technip, QB5 and Platinum Sentral.
For the full year period, net profit fell 60.2% to RM29.12 million versus RM73.13 million a year ago.
It recorded revenue of RM160.99 million, a decrease of 6.7% over the previous year’s RM172.53 million, mainly due to lower revenue generated from Platinum Sentral, Wisma Technip, QB5 and loss of revenue from QB8-DHL XPJ after the disposal took place on April 12, 2018.
MRCB Quill Management Sdn Bhd (MQM), the manager of MQREIT, said its FY19 distribution per unit (DPU) is 6.8 sen, which is 15.8% lower compared to the FY18 DPU of 8.08 sen.
The DPU of 6.8 sen consists of an interim distribution of 3.43 sen, paid to MQREIT unitholders on Sept 23, 2019, and the proposed final distribution of 3.37 sen for the six-month period ended Dec 31, 2019.
The proposed final distribution of 3.37 sen is expected to be paid on Feb 28, 2020.
The DPU of 6.8 sen also translates to a distribution yield of 6.8% based on the closing price of RM1 per unit as at Dec 31, 2019.
MQM chairman Tan Sri Saw Choo Boon said despite the current challenging Klang Valley office market environment, MQREIT has recorded a stable portfolio occupancy rate of 90% and a healthy weighted average lease expiry of 4.9 years as at the end of FY19.
“As we anticipate that the Klang Valley office market will continue to be challenging in 2020, on-going asset management and leasing strategies centered on tenant retention as well as prudent cost management will remain our focus to ensure stable occupancy and sustainable income contribution are achieved in 2020.”
MQM CEO Yong Su-Lin said MQREIT had 369,000 sq ft (19% of its total leased net lettable area) due for renewal in 2019.
The manager’s active leasing and asset management strategies throughout the year has ensured a take-up rate of 92% consisting of 260,000 sq ft of tenant renewals and 77,000 sq ft of new leases secured.
In respect of leases due for renewal in 2020, the bulk of these leases are due in the last quarter of 2020.
“In line with our on-going marketing strategies, we have initiated early renewal negotiations and planned for asset enhancement initiatives centered on enhancing the quality and physical condition of MQREIT’s properties.”
As at Dec 31, 2019, MQREIT’s gearing ratio stood at 37.8% with 76% of its total borrowings are on fixed interest rate.
