Capitaland Ascendas Reit posts 5.4% rental reversion in Q3
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CAPITALAND Ascendas Reit (Clar) posted a positive rental reversion of 5.4 per cent for lease renewals in Q3 ended September, down from 13.2 per cent in Q2, the manager announced in a quarterly business update on Monday (Oct 31).
It expects rental reversion for FY2022 to be in the “positive mid-single digit range”. In the year to date, rental reversion stands at 8 per cent.
The Reit manager noted that the “heightened risk environment” continues to put pressure on the global outlook. “In addition to rising interest rates and inflation, the export bans by the United States of certain advanced materials and technologies to China has added to the uncertainty and volatility in the global supply chains,” it said.
It also warned that the ongoing Russian-Ukraine war will continue to have some “destabilising” effect on global markets, which may have some impact on tenants’ businesses as well as on Clar’s operating costs.
Clar’s portfolio occupancy rose slightly to 94.5 per cent at the end of Q3, down from 94 per cent as at end-June. Overall weighted average lease expiry (WALE) stood at 3.9 years.
Occupancy in Singapore came in at 91.8 per cent for the quarter, down from 91.9 per cent as at end-June. It recorded 51.6 per cent for occupancy of investments completed in the last 12 months, down from 87.8 per cent as at end-June.
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Clar also announced the acquisition of two properties in Singapore for S$296.7 million in Q3. One was the Philips APAC Centre at 622 Toa Payoh Lorong 1, a six-storey high-tech industrial property; the other property was a Grade-A five-storey ramp-up cold storage logistics at 1 Buroh Lane in Jurong.
The manager said it has implemented a higher service charge for its Singapore leases from October this year, to help navigate and mitigate rising utility and interest expenses.
In the US market, occupancy declined marginally to 94.8 per cent as at end-September, from 95.3 per cent in end-June. This was due to lower occupancies in the business space portfolio, the manager said.
In Australia, occupancy rose to 99.1 per cent from 96.6 per cent in end-June due to “positive leasing momentum for logistics spaces”, which included 92 Sandstone Place in Brisbane, and 162 Australis Drive in Melbourne.
Meanwhile, in the United Kingdom and Europe, occupancy rose to 99.4 per cent, mainly due to full occupancy at a logistics property, Transpennine 200 in Greater Manchester.
Units of Clar closed at S$2.62 on Monday, down S$0.01 or 0.4 per cent, before the business update.
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