Pavilion REIT’s 1Q net property income falls 9.6% to RM59m, dragged by lower occupancy rate

KUALA LUMPUR (April 28): Pavilion Real Estate Investment Trust (Pavilion REIT) said its net property income (NPI) fell 9.63% to RM58.85 million for the first quarter ended March 31, 2021 (1QFY21) from RM65.12 million a year ago, due to lower occupancy rates in its shopping malls amid the pandemic.

Revenue slipped 6.03% to RM126.21 million, from RM134.32 million in 1QFY20, its filing to Bursa Malaysia showed.

The REIT said the fall in revenue was mainly due to the lower occupancy rates because of non-renewal of some expired tenancies.

“Income from marketing events and advertising were also badly affected. The Movement Control Order (MCO) last year was only for two weeks from March 18, 2020, with the current year MCO effective from January 13 to March 4, 2021, i.e. a longer period,” it said.

On a quarter-on-quarter basis, Pavilion REIT's NPI dropped 14.04% from RM68.46 million in 4QFY20.

The group did not declare any distribution for the first quarter.

On prospects, the REIT said it is confident that the retail industry will recover and grow in the year ahead.

“The manager is committed to continue to improve performance and support its tenants by sustaining healthy occupancy levels through proactive lease management, leveraging on aggressive marketing strategies and creative initiatives to attract shoppers to its malls while remaining focused on operational recovery by staying vigilant in adherence to government safety guidelines,” it said.

Pavilion REIT's share price closed one sen or 0.71% lower at RM1.40, valuing the group at RM4.27 billion.

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