SINGAPORE - Mainboard-listed industrial landlord Cambridge Industrial Trust (CIT) has posted a 2.1 per cent dip in distribution per unit (DPU) to 1.225 cents for the second quarter ended June 30, 2015, from 1.251 a year ago.
Gross revenue rose 13.2 per cent rise to $27.8 million for the quarter, while net property income increased 9.9 per cent to $21.6 million.
The total distributable amount edged up 0.5 per cent to $15.8 million from a year ago as the number of issued units increased to 1.29 billion from 1.26 billion a year ago.
Commenting on the results, Mr Philip Levinson, CEO of the trust's manager, said, "We maintained steady growth and continued to strengthen our capital structure and position in the quarter."
CIT completed a $130 million five-year medium term note issuance at 3.95 per cent per annum in May, and successfully refinanced its $250 million club loan.
It said its borrowing costs are now "significantly insulated" against interest-rate hikes, with 96.5 per cent of its interest-rate exposure fixed for the next 31/2 years.
About 0.5 million sq ft of leases were renewed in the first half-year and portfolio occupancy increased to 95.5 per cent from 95.0 per cent.
In its results statement, CIT said market conditions remained challenging for the manufacturing sector this year as indicated by the poor performance of industrial economic indicators that persisted in the second quarter. But it added that manufacturing appears to have bottomed out while external trade appears to be on a general uptrend.
CIT said the leasing deals in the second quarter were more renewals and consolidations than expansions.
"Renewals at higher rentals are becoming less frequent with landlords demonstrating flexibility on pricing to retain tenants," it said.
"Going forward, the industrial market is expected to remain lacklustre, weighed down by a strong supply of industrial space coupled with the 30 per cent subletting rule," the company said. "Increasingly, tenants have indicated preference for space on private land due to the increasing regulations and restrictions implemented on government land."
As at June 30, CIT's portfolio of 51 properties is leased to a diversified base of 177 tenants, with a total gross floor area of approximately 8.5 million square feet. The portfolio has a carrying value of approximately $1.4 billion.
In May, CIT completed the acquisition of 160A Gul Circle for $16.21 million. The property has a total GFA of 86,075 sq ft, and is leased to Unicable Pte Ltd for a period of 5 years.