Manulife US Reits posts Q2 DPU of 1.58 US cents, 7.5% higher than projected

Manulife US Reit said it expects its maiden acquisition of 500 Plaza located in New Jersey to start contributing to income from the third quarter of 2017.
Manulife US Reit said it expects its maiden acquisition of 500 Plaza located in New Jersey to start contributing to income from the third quarter of 2017.PHOTO: MANULIFE US REIT

SINGAPORE - Manulife US Real Estate Investment Trust, the first pure-play US office Reit listed in Asia, announced on Tuesday (Aug 8) a distribution per unit (DPU) of 1.58 US cents for the second quarter ended June, 7.5 per cent higher than it projected.

The Reit, which gained its Singapore listing in May 2016, recorded net property income of US$12.8 million which was 3.7 per cent above projection, while gross revenue at US$19.1 million was 0.3 per cent below projection due to lower recoveries income. This was partially offset by higher rental and other income mainly arising from rental escalations and higher car park income.

For the first half-year, Maulife US Reit achieved DPU of 3.23 US cents, 8 per cent higher than the projected, as net property income of US$25.6 million and revenue of US$39.7 million.

As at June 30, the REIT's portfolio valuation increased 2.8 per cent over the half-year to US$857.5 million.

With a high occupancy rate of 95.9 per cent based on committed leases, weighted average lease expiry of 5.3 years and limited percentage of leases expiring in 2017, the Reit manager said it expects the portfolio to deliver a stable performance.

Market conditions continue to be generally favourable in the three markets that Manulife US Reit has invested in, with minimal new supply and rising market rents, it said.

Said Jill Smith, CEO of Manulife US Real Estate Management Pte Ltd: "During this period, we announced our maiden acquisition of 500 Plaza located in New Jersey. This acquisition demonstrates growth and scalability, and will start to contribute from the third quarter of 2017 onwards. Post our first acquisition, we will continue to seek yield accretive deals to grow the Reit in a sustainable manner."

In a separate filing on Tuesday, the Reit said it had entered into a loan agreement with Wells Fargo Bank, National Association, for an aggregate principal amount of up to US$51.6 million, secured partly by a first mortgage on the 500 Plaza property.

The loan comprises an initial funding of US$40 million, as well as a good news facility of up to US$11.6 million for Manulife US Reit's future budgeted capital and leasing costs.