SABANA Industrial Reit : M1GU 0% (Sabana Reit) kicked off the financial reporting season for S-Reits last week with the release of its first half (H1) FY2023 (ended Jun 30, 2023) financial results.

Sabana Reit saw H1 2023 gross revenue rise by 23.2 per cent year on year (yoy) to S$55.3 million and net property income (NPI) increase by 0.5 per cent yoy to S$27.2 million.

Revenue growth was largely driven by higher portfolio occupancy rate while NPI was offset by higher property expense including higher utility costs.

As a result, the total distributable amount to unitholders for H1 2023 was S$17.8 million, 3.9 per cent higher yoy, while distribution per unit rose by 1.3 per cent to 1.61 Singapore cents.

Sabana Reit reported a higher overall occupancy rate of 93.9 per cent as at Jun 30, 2023, representing a 2.6 percentage point growth compared with the occupancy rate of 91.3 per cent a year ago.

It also achieved record rental reversions of 27.1 per cent and 20.1 per cent for Q2 2023 and H1 2023, respectively.

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Sabana Reit’s manager noted that the improvement in occupancy rate was underpinned by the strong leasing momentum backed by robust demand from third-party logistics providers in the first half of the year.

However, the Reit maintained a cautious outlook and cited macro-economic challenges going into the second half of 2023 as well as the drop in occupancy rates across Singapore’s industrial property market.

According to JTC, overall occupancy rate for Singapore’s industrial property market fell 0.6 percentage point in Q1 2023 compared with the previous quarter.

This was due to new completions in Q1 2023, and as new supply continues to exceed new demand.

This coming week, another 17 S-Reits and property trusts will be releasing their earnings or business updates for the period ended Jun 30, 2023.

This will be followed by another 15 S-Reits that will be submitting their reports between Jul 31, 2023 and the middle of August. SGX RESEARCH

The writer is a research analyst at SGX. For more research and information on Singapore’s Reit sector, visit sgx.com/research-education/sectors for the monthly S-Reits & Property Trusts Chartbook.

Source: SGX Research S-Reits & Property Trusts Chartbook.