KUALA LUMPUR (June 17): MRCB-Quill Real Estate Investment Trust's (MQREIT) net property income for the quarter ended March 31, 2020 (1QFY20) climbed 1.29% to RM32.8 million, from RM32.38 million last year, thanks to higher revenue generated from Menara Shell, Wisma Technip and Tesco.

Quarterly earnings per unit rose to 1.85 sen, from 1.81 sen for 1QFY19, as net profit climbed 1.94% to RM19.79 million from RM19.41 million.

The REIT, which has exposure to both the commercial and retail segments, also noted a 0.85% increase in property operating expenses to RM9.42 million from RM9.34 million.

Meanwhile, total expenditure slid 2.8% to RM13.08 million from RM13.46 million on lower managers' and trustees' fees – mainly due to lower gross asset value – and lower finance cost on lower short-term interest rates.

Revenue for the quarter climbed 1.19% to RM42.22 million, from RM41.72 million, on higher contributions from the three assets mentioned above.

On prospects, MQREIT said that 19% of its total net lettable area, or some 371,000 sq ft, is due for renewal this year.

Of that total, 2% of the leases were due in 1QFY20, where only 93% were renewed.

“The Klang Valley office market is expected to remain challenging,” it said.

“We will continue to focus on asset management and leasing strategies centred on tenant retention to overcome the challenging operating environment,” it added.

At the noon market break, MQREIT's unit price had climbed half a sen or 0.75% to 67.5 sen, valuing it at RM723.45 million. Year to date, the counter has fallen by 32.5%.