Fortune Real Estate Investment Trust announced healthy revenue and net property income for last year, backed by a better portfolio asset performance.
Fortune Reit says revenue grew 8.6 per cent for the year to HK$909.4 million and net property income grew 7.6 per cent to HK$642.1 million.
Justina Chiu, deputy CEO of Fortune Reit, says the growth in revenue is mainly due to better performance from the portfolio of properties that the real estate investment trust managed during the year. The property manager says Fortune City One has demonstrated exceptional growth, with net property income increasing 14.9 per cent from the previous year, after renovations at Fortune City One Plus in September 2010, helping to drive revenue growth. Income available for distribution achieved a record high of HK$442.3 million, up 8.8 per cent from last year.
The distribution per unit (DPU) for the 2011 financial year increased 8 per cent year-on-year to 26.30 HK cents, compared with 24.35 HK cents in 2010, representing a dividend yield of 7 per cent.
Fortune Reit's portfolio of 14 retail properties was appraised at HK$16.39 billion as at December 31, 2011, an increase of 23.2 per cent from HK$13.3 billion a year earlier. The higher valuation reflects Fortune Reit's improved asset performance, while its gearing ratio and aggregate leverage was reduced to 18.8 per cent. Fortune Reit remains one of the lowest geared real estate investment trusts in the region.
Chiu says leasing momentum was robust with the occupancy rate maintained at 97 per cent, despite frictional vacancies due to continuing asset enhancement initiatives (AEI). Rental reversion improved to 15.2 per cent, as passing rent rose 12.2 per cent from last year, reaching an all-time high of HK$32.2 per sqft.