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This article first appeared in The Edge Financial Daily on August 8, 2019

KUALA LUMPUR: MRCB-Quill REIT’s (MQREIT) net property income (NPI) for the second quarter ended June 30, 2019 (2QFY19) fell 12.4% to RM29.49 million, from RM33.65 million a year earlier.

MQREIT said this was due to lower income recognition from properties such as Platinum Sentral, Wisma Technip, Quill Building 5 as well as a gain from the disposal of Quill Building 8-DHL (XPJ) recognised in 2QFY18.

In a filing with Bursa Malaysia yesterday, MQREIT said revenue for the quarter came in at RM39.19 million, down 10.3% from RM43.69 million previously.

MQREIT declared an income distribution per unit (DPU) of 3.43 sen, payable on Sept 23.

For the six months ended June 30, 2019, MQREIT’s NPI fell 9.3% to RM61.87 million, from RM68.18 million a year ago. Revenue during the same period decreased 8% to RM80.91 million from RM87.99 million.

MRCB Quill Management Sdn Bhd (MQM) chairman Tan Sri Saw Choo Boon, in a separate statement, said he expects the operating environment for office space in the Klang Valley to remain challenging due to oversupply pressure.

“This is not expected to abate soon with more office buildings pending completion.

“We are confident the trust will ride out the office market down cycle with our continued focus on cost management, tenant retention and optimisation of rental contribution,” said Saw.

MQM chief executive officer Yong Su-Lin said the REIT has secured new leases of about 123,000 sq ft for a few of its properties, with demand coming from the oil and gas, information technology, services and retail sectors.

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