Cromwell E-Reit’s Q3 distributable income slips 0.4% to 24.2m euros

CROMWELL European Reit (Cromwell E-Reit)‘s income available for distribution to unitholders fell slightly year-on-year, from 24.3 million euros (S$34.1 million) to 24.2 million euros, or 0.4 per cent, it announced on Thursday (Nov 10).

Both gross revenue and net property income rose for the quarter that ended in Sep 30. The Reit’s gross revenue saw a 10.4 per cent gain to 55.9 million euros from 50.7 million euros, while net property income grew 4.1 per cent to 34.5 million euros from 33.1 million euros.

The manager said that this was primarily driven by new acquisitions, indexation, stronger market rental growth and higher occupancy in the light industrial or logistics sector, although the higher net property income was offset by higher interest, trust and tax expenses.

Overall portfolio occupancy stood at 95.7 per cent while its weighted average lease expiry (WALE) was unchanged at 4.6 years.

As at Sep 30, Cromwell E-Reit’s aggregate leverage stood at 38.9 per cent. It holds roughly 220 million euros in cash, undrawn revolving credit facility and assets held for sale.

In early October this year, the Reit inked a a new 180 million euros four-year sustainability-linked term loan facility, which will be used to refinance a majority of the debt maturing in November 2023. The manager said that it was also in “advanced stages” to secure additional loan facilities of up to 100 million euros to complete all refinancing till November 2024.

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“The rising interest rate environment may negatively impact cap rates and potentially offset some of the gains from higher rentals and occupancy on the overall portfolio valuation in 2023,” said Simon Garing, chief executive of Cromwell E-Reit’s manager.

“In light of this, the manager will continue to recycle assets to refresh the portfolio.” 

Units of Cromwell E-Reit ended Wednesday flat at 1.53 euros.