Manulife US Reit posts Q4 DPU of 1.54 US cents, beating its forecast by 3.6%

SINGAPORE - Manulife US Reit announced on Monday (Feb 13) a distribution per unit (DPU) of 1.54 US cents for the fourth quarter ended Dec 31, 2016, beating its forecast of 1.49 US cents by 3.6 per cent.

Its DPU of 3.55 US cents for the period from the date of its listing on May 20, 2016, to Dec 31, 2016, also exceeded its projection of 3.39 US cents by 4.8 per cent. This DPU will be paid out on March 30, 2017.

The Reit said its performance from its listing to Dec 31 was due to higher property performance and lower borrowing costs and trust expenses. Net property income for the period was 1 per cent higher than forecast at US$29.97 million, mainly due to higher rental and other income, and lower property expenses.

The first pure-play US office Reit listed in Asia said market conditions continue to be generally favourable in the three markets that it has invested in, with minimal new supply and rising market rents.

Ms Jill Smith, chief executive officer of the Reit manager said, "Moving forward, the US commercial market is poised to benefit from the growth of the US economy."

The REit's initial portfolio comprises three prime, freehold and Class A or Trophy quality office properties located in Los Angeles; Irvine, Orange County; and Atlanta. The IPO portfolio, valued at US$833.88 million, has an aggregate net lettable area of 1.8 million square feet.

As at Dec 31, 2016, the portfolio value increased by 2.5 per cent over the previous valuation as at Sept 30, 2016. For FY2016, the Reit's portfolio value has increased by US$56.3 million or 7.2 per cent over the acquisition cost.

Based on committed leases, the Reit said its property portfolio occupancy remained strong at 97 per cent. The Reit has a weighted average lease expiry of 5.8 years with 67.8 per cent of the leases expiring in 2022 and beyond. In addition, the Reit registered positive rental reversions of 10.5 per cent on approximately 130,000 square feet of leases for 2016.