CDL Hospitality Trust (CDLHT) on Friday (Apr 28) posted a 35 per cent increase in its net property income (NPI) for its first quarter ended Mar 31, 2023, to S$32.7 million, up from S$24.2 million a year earlier.

Gross revenue for the stapled group, comprising CDL Hospitality Reit and CDL Hospitality Business Trust, also grew 31.5 per cent to S$60.8 million.

This comes on the back of largely higher revenue per available room across most of its properties, except those in New Zealand and Maldives. Those markets also saw a dip in NPI.

In Germany, NPI declined due to a weakening euro against the Singapore dollar, coupled with a “seasonally weak first quarter”, the manager said.

The group’s net property income from its core market, Singapore, experienced the biggest increase of 82.5 per cent – or an absolute gain of S$8.8 million to S$19.6 million in Q1 2023.

The managers said they expect to see continued growth the hospitality sector in Singapore, particularly as Chinese tourists return to international travel.

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“The managers are confident of the medium- to long-term prospects of the Singapore market and will continue to assess opportunities to invest through asset enhancements to strengthen the competitiveness of its hotels in CDLHT’s core market.”

CDLHT’s gearing stood at 37.5 per cent in Q1 this year, up slightly from 36.6 per cent in the last quarter.

While the trust expects business performance to improve on Chinese travellers’ return, it added that higher interest rates would continue to impact borrowing costs.

“While inflationary cost pressures, higher energy prices and funding costs may affect CDLHT’s performance in the near to medium term, the positive trends in the hospitality industry are expected to offset some of these costs, particularly in strong markets or periods of high demand,” said the manager.

Stapled securities in CDLHT finished Thursday S$0.02 lower, down 1.6 per cent to S$1.22.