Ascott Reit's distributable income hits new high on currency gains, asset sales

Ascott Reit's acquisition of serviced residence Citadines Shinjuku Tokyo contributed to the trust's revenue and profit increases in the third quarter.
Ascott Reit's acquisition of serviced residence Citadines Shinjuku Tokyo contributed to the trust's revenue and profit increases in the third quarter.PHOTO: ASCOTT RESIDENCE TRUST

Currency gains and asset sales proceeds drove Ascott Residence Trust to record highs in the third quarter.

Income available for distribution to unitholders came in at $38.7 million - up 21 per cent on the same period a year earlier and the highest since the Reit was launched 10 years ago.

The record high was due mainly to the realised exchange gain of $3.3 million from repaying foreign currency bank loans with the sale proceeds from Fortune Garden Apartments in Beijing.

Distribution per unit was 2.35 cents for the three months to Sept 30, 14 per cent more than last year and the best in three years.

Quarterly revenue grew 9 per cent to $123.9 million while gross profit increased 4 per cent to $57.5 million, boosted by acquisitions last year and this year, including the 160-unit Citadines Shinjuku Tokyo.

Mr Bob Tan, chairman of Ascott Residence Trust Management, the trust manager, said Ascott Reit's entry into the United States last year was a significant milestone.

  • AT A GLANCE

    REVENUE

    $123.9 million (+9%)

    DISTRIBUTABLE INCOME TO UNIT HOLDERS

    $38.7 million (+21%)

    DPU

    2.35 cents (+ 14%)

"The two prime properties in New York have a high average occupancy of over 90 per cent and they are the biggest contributors to our strong performance. As we mark Ascott Reit's 10th anniversary this year, we remain focused on delivering stable returns," he said.

Mr Tan noted that the trust is the largest hospitality Reit in Singapore with an asset size of about $5 billion with a diversified portfolio across 38 cities in 14 countries.

"When our acquisition of Ascott Orchard Singapore is completed next year, our asset size will expand to $5.3 billion," he said.

The Reit also completed the first phase of renovation at Ascott Makati in Manila in August, while refurbishment work at Citadines Barbican London, Somerset Ho Chi Minh City and Somerset Millennium Makati is expected to be completed next year.

In a separate announcement, the Reit said that of gross proceeds of about $100 million it had previously raised, $2.3 million was used for the final outstanding balance to buy a New York property and $8 million was used to repay loans.

Quarterly earnings per unit was 1.65 cents, from 2.65 cents a year ago. Net asset value per unit as at March 31 was $1.30, from $1.41 as at Dec 31. Ascott Reit's units were unchanged at $1.135 yesterday.

A version of this article appeared in the print edition of The Straits Times on October 21, 2016, with the headline 'Ascott Reit's distributable income hits new high on currency gains, asset sales'. Print Edition | Subscribe