Property trust company to distribute HK$702m to unitholders
The Link Reit, the largest real estate investment trust listed in Hong Kong, declared a better than expected first-half dividend after increasing rents when leases came due for renewal.
The Link, which owns 180 shopping centres and car parks in public housing estates, announced distribution income, or underlying profit, of HK$702 million or 32.81 HK cents per unit for the six months ended September, 6.3 per cent higher on an annualised basis than the reit pledged in its listing prospectus.
The company plans to distribute at least 61.76 HK cents per unit for this year to March, according to the prospectus. The reit, which was spun off by the Housing Authority for HK$22 billion, has to pay out as dividends 100 per cent of its profit attributable to shareholders.
The annualised distribution yield was 6.37 per cent based on last November's initial public offering price of HK$10.30 per unit or 6.71 per cent based on the discounted offer price to the Hong Kong public of HK$9.78 per unit.
The Link said in its listing prospectus it will offer an annualised yield of at least 5.53 per cent for the first year.
Average rents for retail leases that came up for renewal during the first half to September rose 8.3 per cent, said Victor So Hing-woh, the chief executive of the Link Management, which manages the trust's properties.