MPACT Q2 DPU slips 3.5% as overseas properties weigh on income
MPACT’s DPU fell to S$0.0194 as weaker overseas contributions offset gains at VivoCity and lower finance expenses.
Mapletree Pan Asia Commercial Trust (MPACT) received stronger support from VivoCity and lower finance expenses in the quarter ended September, but those gains weren’t enough to prevent a decline in distributions. Its distribution per unit (DPU) fell 3.5 per cent year on year to S$0.0194, from S$0.0201.
The figures point to a split performance across the portfolio: Singapore’s retail and office assets provided a degree of stability, while weaker contributions from overseas properties and the loss of income from divested assets weighed on the trust. The manager cited the non-renewal of a lease at Fujitsu Makuhari Building in Japan, challenging market conditions in China and continued headwinds in Hong Kong.
VivoCity’s performance helped offset some of the pressure on MPACT’s distributions. PHOTO: BT FILE
Revenue and property income contract
MPACT’s revenue fell 5 per cent to S$207.5 million from S$218.5 million a year earlier. Net property income (NPI), which reflects property revenue after property operating expenses, declined 6.3 per cent to S$153.5 million from S$163.9 million. Distributable income decreased 2.9 per cent to S$103.1 million, compared with S$106.2 million in the corresponding period.
The smaller drop in distributable income than in revenue and NPI shows how lower finance expenses helped cushion the operating decline. The source figures don’t quantify the separate contribution from that reduction, so its precise effect on the distribution can’t be determined from the reported numbers here.
Three assets no longer contributed to the comparison: TS Ikebukuro Building, Abas Shin-Yokohama Building and the office component of Festival Walk. Their divestment reduced the income base against which the current quarter is measured. That effect sits alongside weaker trading conditions at overseas properties, making it difficult to attribute the year-on-year decline to any single factor.
At VivoCity, performance improved after the completion of refurbishment works at Basement 2, while rental growth also supported results. The mall’s contribution helps explain why the trust’s home market continues to act as a stabilising part of its portfolio as overseas operations face softer conditions.
First-half figures show a similar pattern
For the first half ended September, MPACT’s DPU declined 3 per cent to S$0.039 from S$0.0402 a year earlier. Distributable income was down 2.7 per cent at S$207.3 million, compared with S$213 million.
Revenue for the six-month period fell 5.3 per cent to S$413.9 million, while NPI dropped 6.5 per cent to S$308.3 million. The first-half results therefore echo the quarter’s central tension: income from the property portfolio weakened, while the reduction in distributable income was less pronounced than the declines in revenue and NPI.
The Q2 distribution is scheduled to be paid on Dec 16, following a record date of Nov 10. Those dates set out when eligible unitholders are identified and when payment is due; they don’t change the reported operating trend.
Occupancy improves as leases prepare to start
Portfolio committed occupancy rose to 85.6 per cent as at Sep 30, from 84.4 per cent at the end of June. At Mapletree Business City (MBC), committed occupancy increased to 95.4 per cent. The manager said key committed leases there will begin progressively from Q3 FY2027 and add to rental income.
Committed occupancy and rental income are related but distinct measures. Higher occupancy indicates that more space has leases in place, while the timing of lease commencements affects when that space contributes income. The expected MBC leases may add support over time, but the source provides no amount for their anticipated contribution.
Sharon Lim, chief executive of MPACT’s manager, said Singapore accounted for 61 per cent of portfolio assets under management and 68 per cent of NPI, describing it as the trust’s cornerstone. She pointed to VivoCity’s contribution and room for further optimisation, while saying the focus in overseas markets remains on maintaining occupancy and cash-flow stability.
That emphasis captures the near-term balance facing the trust: Singapore’s contribution and improving committed occupancy offer support, while overseas softness and the absence of income from divested properties remain drags. MPACT units ended Thursday 0.9 per cent lower at S$1.13.
