Sasseur Real Estate Investment Trust (REIT) is the first premium outlet mall REIT listed in Asia. The REIT was listed on 28 March 2018 and its portfolio comprises four retail outlet malls in Chongqing, Bishan, Hefei and Kunming with an aggregate net lettable area (NLA) of 304,573.1 square meters and a portfolio value of approximately Rmb7.7 billion (equivalent to approximately $1.5 billion) as of 31 December 2018.
In its latest earnings release on 18 February 2019, total outlet sales for four malls was Rmb3.4 billion in FY18, surpassing forecast by 7.9 percent. Outlet sales were better as shoppers were attracted to the year-end seasonal promotional event which led to a strong increase in 4Q18. Meanwhile, the portfolio occupancy for 4Q18 improved to 95.2 percent from 94.4 percent in 3Q18 as more tenants signed up and tenant mix adjusted to suit consumer preferences.
Sasseur REIT reported FY18 entrusted management agreements (EMA) rental income of $93.5 million, 2.2 percent higher than the $91.5 million forecast. Meanwhile, distributable income to unitholders at $60.5 million was 12.6 percent higher than forecasted.
The aggregate leverage for the Sasseur REIT stood at 29 percent. Its weighted average cost of borrowing stood at 5.4 percent, with a prudent interest cover of 4.1 times.
Net asset value (NAV) per unit was stable at $0.90 as at 31 December 2018.
Overall, FY18 distribution per unit (DPU) of $0.05128 was also 12.6 percent higher than forecasted $0.04554. This comprises $0.03541 declared for 2H18 and $0.01587 paid for the period from its listing date to 30 June 2018. At the closing price of $0.71 on 18 February 2019, FY18 distribution yield was 9.4 percent, surpassing IPO forecasted yield of 7.4 percent.
Going forward, Sasseur REIT will switch the distribution payment from semi-annually to a quarterly basis with effect from 1Q19.