Aims Apac Reit H2 DPU rises 4.1% to S$0.0513 on higher rental, recoveries

[SINGAPORE] Aims Apac Real Estate Investment Trust (AA Reit) posted on Thursday (May 7) that its distribution per unit (DPU) rose 4.1 per cent to S$0.0513 for its second half ended Mar 31, from S$0.0493 the year before.

Distributions to unitholders increased 4.6 per cent year on year to S$42 million, from S$40.2 million, largely attributed to higher net property income (NPI) and lower borrowing costs.

The distribution will be paid out on Jun 29.

Revenue was up 4.1 per cent at S$97 million for the half year, from S$93.1 million in the year-ago period.

The increase was due to higher rental and recoveries from AA Reit’s logistics, warehouse and industrial properties such as 27 Penjuru Lane and 8 & 10 Pandan Crescent, as well as higher income from 7 Clementi Loop following the completion of asset enhancement initiatives.

Lower property expenses arising from lower electricity expenses and cost efficiencies were also cited as a factor.

This was supported by rental income from the acquisition of 2 Aljunied Avenue 1, completed in November last year, and partially offset by the loss of revenue from the divestment of 3 Toh Tuck Link.

NPI grew 10.3 per cent on the year to S$73 million for the half year, from S$66.2 million, mainly driven by the increase in revenue and decrease in property operating expenses.

Meanwhile, for the full year ended Mar 31, DPU was higher at S$0.0985, versus S$0.096 the prior year. Distributions to unitholders rose 3.1 per cent to S$80.6 million, from S$78.2 million previously.

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Full-year revenue was 2.2 per cent higher at S$190.7 million from S$186.6 million, while NPI rose 5.7 per cent to S$141.3 million from S$133.7 million.

Russell Ng, CEO of the manager, said: “Beyond near-term performance, we are actively positioning our portfolio for the next phase of growth. We see a compelling long-term opportunity in the data centre sector and believe our Australian assets are uniquely placed to participate.

“We are pursuing new data centre opportunities via three levers: maximising the redevelopment or conversion potential of our existing assets, targeting land-rich properties in strategic infill locations near energy infrastructure, and forming partnerships with institutional data centre operators.”

He added that the Reit will remain focused on delivering “stable income growth”, while pursuing acquisitions and advancing its development pipeline.

The manager noted that the portfolio achieved a positive rental reversion of 7.7 per cent across 98 leases over the financial year.

Portfolio occupancy remained stable at 93.6 per cent; on a committed lease basis, it was 96.8 per cent. Aggregate leverage improved to 26.8 per cent as at Mar 31, down from 28.9 per cent the year before.

Units of AA Reit closed flat at S$1.52 on Wednesday.