UPDC REIT Re­wards Unit Hold­ers with N1.26bn Div­i­dend

THISDAY - - BUSINESS WORLD - Nosa Alekhuo­gie

UPDC REIT has re­warded its unit hold­ers with a dis­tri­bu­tion of 24 Kobo per unit.

The com­pany said in a state­ment that the dis­tri­bu­tion, which was pro­posed by the Fund Man­ager, FSDH As­set Man­age­ment Lim­ited, (FSDH AM) was ap­proved by its unit hold­ers at its an­nual gen­eral meet­ing held in Lagos.

Man­ag­ing Direc­tor of FSDH As­set Man­age­ment Lim­ited, Mrs. Olumay­owa Ogun­wemimo, at­trib­uted the per­for­mance of the REIT to not only the qual­ity of as­sets in the REIT but also to the man­age­ment process of the REIT port­fo­lio.

She noted that, FSDH AM will con­tinue to seek ad­di­tional investments in qual­ity real es­tate as­sets and real es­tate re­lated as­sets to en­sure that the REIT con­tin­ues to de­liver on its prom­ise to gen­er­ate and dis­trib­ute com­pet­i­tive re­turns to its unit hold­ers.

She fur­ther that the real es­tate mar­ket was ad­versely af­fected by the eco­nomic re­ces­sion as a num­ber of new de­vel­op­ments recorded slower take-up rate and rental in­come low­ered, as ten­ants were re­quest­ing for a down­ward re­view of rent or a rent free pe­riod.

“The lack of ac­cess to FX on the in­ter­bank mar­ket and the con­tin­u­ous de­pre­ci­a­tion of the Naira on the par­al­lel mar­ket re­sulted to higher costs for re­tail­ers look­ing to fit out and re­stock their stores. This also re­sulted in higher costs for the re­quired pe­ri­odic main­te­nance for a commercial build­ing.

“The prices of fixed-in­come se­cu­ri­ties trended down­wards while yields in­creased in the sec­ond half of the year. The in­crease in yield was as a re­sult of the illiq­uid­ity in the mar­ket re­sult­ing from the ex­ist­ing re­serve re­quire­ments and the Trea­sury Sin­gle Ac­count (TSA) im­ple­men­ta­tion by the FGN. In July 2016, the Mone­tary Pol­icy Com­mit­tee (MPC) in­creased the Mone­tary Pol­icy Rate (MPR) to 14 per cent from 12 per cent.

“De­spite the macroe­co­nomic chal­lenges, No­vare Lekki Mall, Onit­sha Mall and Mary­land Mall were com­pleted and opened to cus­tomers in 2016. There is cur­rently an over­sup­ply of grade A of­fice space. In or­der to at­tract ten­ants, Land­lords had to re­duce rental rates. There was also a shift of the de­mand for of­fice spa­ces from the oil and gas sec­tor to man­age­ment, con­sult­ing, tech­nol­ogy, fi­nance and other ser­vices sec­tor, “she ex­plained.

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