HONG KONGSAR - MediaOutReach - 4 February 2021 - Henderson SunlightAsset Management Limited (the "Manager")announces the interim results of Sunlight REIT for the six months ended 31December 2020 (the "Reporting Period").

Reflecting the unfavourable operating environment attributable to the pandemic outbreak, Sunlight REIT recorded an 8.6% year-on-year decline in revenue to HK$399.5 million for the Reporting Period, while net property income ("NPI") came in at HK$319.5 million, down 7.6%.

The Board hasresolved to declare an interim distribution per unit of HK 12.5 cents, representinga payout ratio of 94.7%, and an annualized distribution yield of 6.6% based onthe closing price of HK$3.77 on the last trading day of the Reporting Period.

The appraised valueof Sunlight REIT's portfolio was HK$18,548.6 million at 31 December 2020,representing a mild decrease of 2.0% from 30 June 2020. Meanwhile, net assetsof Sunlight REIT dropped 2.9% to HK$14,349.7 million, whichtranslates to a net asset value of HK$8.61 per unit.

Highlights of Interim Results

The overall occupancyrate of Sunlight REIT's portfolio at 31 December 2020 was 91.5% (30 June 2020:95.7%). The decline was mainly attributable to office occupancy rate whichdropped to 90.1% (30 June 2020: 95.6%). In contrast, retail occupancy rate of 94.5%was reasonably satisfactory (30 June 2020: 95.8%), demonstrating some earlysigns of stability in domestic consumption. For the Reporting Period, theoffice and retail portfolios registered negative rental reversions of 2.4% and 5.9%respectively, giving rise to an overall negative rental reversion of 4.5%.

In respect of theperformance of key properties, Sunlight Tower was inevitably affected by therental loss due to higher vacancy and slower new letting activities, resulting in a 13.1%decline in NPI. On the bright side, Strand 50 achieved an 8.5% increase in NPI,thanks to a timely refurbishment. On the retail front, NPI of Sheung ShuiCentre Shopping Arcade dropped 11.4%, while Metro City Phase I Property hasdemonstrated its resilience, with NPI recording a moderate decrease of 4.5%.  

During the ReportingPeriod, Sunlight REIT completed its first sustainability-linked loan with anamount of Japanese yen 7,000 million (equivalent to approximately HK$513million) for a tenure of seven years, while issuing its maiden HK$300 millionfive-year medium term notes. At 31 December 2020, the gearing ratio of SunlightREIT was 22.4% (30 June 2020: 21.6%), while the percentage of fixed rateborrowings has increased to approximately 79%.

Mr. Wu Shiu Kee, Keith, Chief Executive Officer of the Manager said,"While lower occupancy rates, negative rental reversions and the impact ofrental concessions are set to stay, their adverse effects should be lesspronounced, barring unforeseen circumstances. On a more encouraging note,Sunlight REIT stands to benefit from contributions from new tenants such as DahSing Bank, Limited, stringent cost containment measures as well as proactivefinancing initiatives implemented by the Manager. Meanwhile, we welcome therecent amendments to the Code on Real Estate Investment Trusts, which shouldprove beneficial to the long term development of Sunlight REIT. "

Remarks: Attached financialhighlights of FY2020/21 interim results of Sunlight REIT.

Financial Highlightsof FY2020/21 Interim Results:

(in HK$' million, unless otherwise specified)

Note: Included afair value loss on investment properties of HK$380.2 million (six months ended31 December 2019: HK$162.5 million).

Disclaimer: Theinformation contained in this press release does not constitute an offer orinvitation to sell or the solicitation of an offer or invitation to purchase orsubscribe for units in Sunlight REIT in Hong Kong or any other jurisdiction.

About Sunlight REIT

Sunlight REIT (Stock code: 435) is a real estate investment trustauthorized by the Securities and Futures Commission and constituted by thetrust deed dated 26 May 2006 (as amended and supplemented by six supplementaldeeds) (the "Trust Deed"), and has been listed on The Stock Exchange ofHong Kong Limited on 21 December 2006. Sunlight REIT offers investors theopportunity to invest in a diversified portfolio of 11 office and five retailproperties in Hong Kong with a total gross rentable area of over 1.2 millionsq. ft.. The office properties are primarily located in core business areas,including Wan Chai and Sheung Wan, as well as in decentralized business areassuch as Mong Kok and North Point. The key retail properties are situated inregional transportation hubs and new towns including Sheung Shui, Tseung Kwan Oand Yuen Long.

About the Manager

The Manager of Sunlight REIT is an indirect wholly-owned subsidiary ofHenderson Land Development Company Limited. Its main responsibility is tomanage Sunlight REIT and all of its assets in accordance with the Trust Deed inthe sole interest of its unitholders.