Prosperity Real Estate Investment Trust (Prosperity Reit) reported steady financial results for the year ended December 31, 2011 with revenue increasing by 2 per cent to HK$275.6 million.
The reit says income available for distribution grew by 10.6 per cent. Correspondingly, distribution per unit to unit holders increased by 9.2 per cent.
Its portfolio occupancy rate remained stable at 98.8 per cent, while the average effective unit rent increased from HK$14.67 per square foot to HK$15.05. Prosperity's proactive leasing approach and effective tenant recruitment strategies enabled it to increase its tenant retention rate from 64.5 per cent in 2010 to 66.9 per cent last year.
The reit says its achievements were attributable to management's pragmatic approach in a tough economic climate, which led to a significant reduction in finance costs and a strong rental reversion rate.
Mavis Wong, acting chief executive, says the world economy faced many challenges last year, including the completion of Quantitative Easing II, Greece's sovereign debt crisis and the United States credit rating downgrade.
'These external market uncertainties dampened business sentiment, which weighted on Hong Kong's commercial properties. We are satisfied with the results and will continue to deliver positive results in 2012,' Wong says.
It continued to benefit from the strength of the mainland's foreign trade. 'Large percentages of our tenants are companies focusing on Asian markets, and they have remained relatively resilient amid the volatile market,' she says.