AIMS Apac Reit posts 18% fall in Q3 DPU to 2.05 cents

SINGAPORE (THE BUSINESS TIMES) - AIMS Apac Reit (AA Reit) reported a distribution per unit (DPU) of 2.05 cents for the third quarter ended Dec 31, 2020, down 18 per cent from its Q3 DPU of 2.5 cents a year ago.

In a pre-market bourse filing on Thursday (Jan 28), its manager said the lower distribution was mainly due to management fees paid fully in cash for the quarter, as well as having an amount reserved for distribution to perpetual securities holders.

Gross revenue for Q3 grew 9.1 per cent to $32.1 million from $29.5 million in the previous year. The increased revenue was attributed to contributions from AA Reit's recently acquired property at 7 Bulim Street, as well as higher rental and recoveries at the properties at 3 Tuas Avenue 2 and 20 Gul Way.

These were however partially offset by lower contributions from the property at 1A International Business Park arising from the conversion from master lease to multi-tenancy leases, the expiry of the master lease at 541 Yishun Industrial Park A, and lower rental and recoveries from the property at 103 Defu Lane 10, said the real estate investment trust's (Reit) manager.

Net property income for the quarter under review stood at $23.6 million, up 2 per cent from $23.1 in the previous year. This resulted from the higher gross revenue being offset by increased year-on-year property operating expenses in the absence of a property tax refund recognised a year ago.

As such, Q3 distributions to unitholders dropped 17.6 per cent on year to $14.5 million from $17.6 million previously.

The distribution will be paid out on March 19 after the record date on Feb 5.

The Reit's DPU stood at 6.05 cents for the nine months ended Dec 31, 2020, representing a 19.3 per cent decline from its DPU of 7.5 cents for the same period a year ago.

AA Reit's aggregate leverage was 34.1 per cent as at end-2020. The Reit manager noted cash balances of about $14.8 million, and undrawn committed facilities of $139.5 million.

Looking ahead, AA Reit's manager expects the industrial outlook for Singapore and Australia to be supported by shifts in consumer behaviour towards e-commerce, along with increased business activities in the advanced manufacturing and information and communications technology industries.

"The Reit has continued to maintain a stable performance, underpinned by the portfolio's diversity in tenant and asset mix, with over 50 per cent in the resilient logistics and warehouse sector," commented Koh Wee Lih, chief executive of the manager.

"We are pleased to note that the Reit's focus on proactive leasing efforts has translated into the completion of 21 leasing deals during the quarter, with above-industry portfolio occupancy rate at 95.7 per cent."

Units of AA Reit ended Wednesday down $0.01 or 0.8 per cent at $1.29, before the announcement.

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