S Prime Management Co., Ltd., the manager of the real estate investment trust S Prime Growth (SPRIME), reported its Q3 2021 results with total revenue of 115.21 million baht and net investment profit of 78.16 million baht. The company is confident that its performance has passed the lowest point and has announced a dividend payment of 0.160 baht, which is a growth of over 23% from the previous quarter and equivalent to pre-COVID levels.

Mr. Ketukorn Khemthorn, Managing Director of S Prime Management Co., Ltd., as the manager of the S Prime Growth (SPRIME) trust, revealed that signs of recovery in the office rental market are becoming evident, including the gradual return of tenant employees to work, contract renewals with existing tenants, and new tenant inquiries for space. Overall, in Q3, the trust generated total revenue of 115.21 million baht and net investment profit of 78.16 million baht. Considering these circumstances, the trust's board has resolved to pay a dividend of 0.160 baht per unit, which matches the level before the COVID crisis and represents a 23% increase from the previous quarter's payment of 0.130 baht per unit.

Following the easing of COVID-19 control measures, business operations have returned to near-normal levels, with over half of the tenant employees in the Sun Tower office returning to work under strict pandemic prevention measures. This underscores the importance of working in an office, which operators believe cannot be fully replaced by Work from Home or Work Everywhere models.

Regarding lease renewals set to expire within the year, the process is proceeding as expected. As of the end of October, over 92% of contracts have been successfully renewed, while 6% are under negotiation and expected to be finalized by December. Additionally, the trust has been able to lease space to new tenants, including regular office space and service offices, which come equipped with utilities, office equipment, furniture, and various amenities, allowing tenants to start using the space immediately. This service office model has been developed as part of the trust's efforts to increase occupancy rates, with renovations of some areas that became vacant due to tenants downsizing as a result of the COVID-19 crisis, following the service office concept, and began operations earlier this year. With satisfactory progress in renewing contracts with existing tenants and leasing to new tenants, combined with ongoing negotiations with several interested parties, the trust is highly confident that its performance has passed the lowest point and that occupancy rates will continue to rise.

“The Sun Towers office, which is the main asset, is located in the Lat Phrao intersection, a central economic area in northern Bangkok, close to public transport connections and expressway access. The building has been upgraded to modern standards in terms of hygiene and safety, comparable to CBD office buildings, while rental prices are 30-40% lower than similar buildings in the CBD. Additionally, the service office model effectively meets current rental space demands, making Sun Towers a preferred choice for tenants looking to expand their office space in the future,” said Mr. Ketukorn.

The trust believes that post-COVID, office buildings in high-potential areas still have growth opportunities. Therefore, it is an opportune time for the trust to start looking for new assets to strengthen its portfolio, whether in terms of location diversity, building types, or tenant groups, ultimately enabling the trust to generate sustainable returns for unit holders. The trust is currently studying the feasibility of several office building projects from Singha Estate Group, which have performed exceptionally well during the COVID-19 crisis, such as the Singha Complex, which has a leasing rate of 95%.

As for the trust's financial position, it continues to maintain revenue levels and effectively control expenses. At the board meeting on November 11, 2021, a resolution was passed to approve a dividend payment from the operational results from July 1 to September 30, 2021, to unit holders at a total rate of 0.160 baht per unit. The book closing date to determine the list of unit holders entitled to the dividend is set for November 26, 2021, with payments scheduled for December 8.