UPDC REIT Rewards Unit Holders with N1.26bn Dividend
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.