KUALA LUMPUR (Nov 9): Sentral REIT’s net property income (NPI) rose 6.05% to RM30.12 million in the third quarter ended on Sept 30, 2023 (3QFY2023) from RM28.40 million a year ago, underpinned by higher gross revenue, offset by higher property expenses.

Gross revenue for the quarter increased by 11.43% to RM39.78 million from RM35.7 million a year prior, mainly due to higher revenue generated from Menara Shell, Platinum Sentral and Sentral Building 3.

Property operating expenses for 3QFY2023 rose 32.5% year-on-year (y-o-y) to RM9.7 million, mainly due to higher operating expenses incurred in relation to the higher utilities expenses for some of the properties under the portfolio.

For the nine-month period ended on Sept 30, 2023 (9MFY2023), the REIT’s NPI edged 2.03% higher to RM88.61 million from RM86.85 million a year ago.

Gross revenue rose 4.03% y-o-y to RM115.44 million from RM110.96 million, largely due to higher revenue generated from Menara Shell and Platinum Sentral, and the impact of revenue straight-lining over the lease term pursuant to requirements of MFRS 16 Lease.

In comparison with the immediate preceding quarter (2QFY2023), the REIT’s NPI came in 3.16% higher compared to RM29.21 million while gross revenue increased 4.16% from RM38.19 million.

Commenting on Sentral REIT’s financial performance, its chief executive officer Derek Teh Wan Wei said its capital management approach continues to be prudent and disciplined with a weighted average cost of debt of 4.4% per annum as at Sept 30, 2023.

“The risk of interest rate fluctuations is abated with the expectation that the overnight policy rate will remain stable at 3% throughout the rest of the year.

“However, regular reviews will still be carried out to rebalance Sentral REIT’s fixed and floating rate borrowings composition,” he said.

At the time of writing, Sentral REIT units were 0.5 sen or 0.61% higher at 83 sen, giving it a market capitalisation of RM889.58 million.