ESR-Logos Reit reports S$69.9m in Q3 net property income post-merger
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Michelle Zhu
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ESR-LOGOS Reit saw its gross revenue and net property income (NPI) of S$96.2 million and S$69.9 million, respectively, for the third quarter ended Sep 30 – representing a 57.4 per cent and 59.2 per cent increase from the previous year.
In a business update on Wednesday (Oct 26), its manager attributed the higher year-on-year gross revenue and NPI to contributions from Ara Logos Logistics Trust (ALog Trust) after the merger in April 2022.
The latest set of results brings ESR-Logos Reit’s gross revenue for the year to date (YTD) to S$243.9 million, up 34.8 per cent from S$180.9 million the previous year. YTD NPI rose 32 per cent to S$172.7 million from S$130.8 million per cent a year ago.
Net asset value (NAV) per unit as at Sep 30, however, fell 7.6 per cent to 36.6 Singapore cents from 39.6 cents the year before after factoring in the premium paid over ALog Trust’s NAV as well as transaction costs that were incurred to the merger being written off in the second quarter of 2022.
For both Q3 and YTD 2022, the Reit’s (real estate investment trust) portfolio achieved a positive rental reversion of +11.4 per cent, with space demand mainly driven by the logistics and high-specs segment.
Its weighted average lease expiry stood at 3.2 years with about 6.4 per cent of leases due for renewal in FY2022. About 91 per cent of these expiring leases are in the process of the renewal, said the manager.
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Portfolio occupancy stood at 92.4 per cent – which the manager highlighted is above the industry average albeit down from previous quarters (94.1 per cent in Q2 and 93.7 per cent in the first quarter).
Citing advanced estimates from the Ministry of Trade and Industry for Q3, the manager foresees a slowdown in global economic activity to dampen private consumption and investments going forward, with Singapore’s manufacturing sector and some trade-related services expected to moderate downwards.
While the manager said it anticipates continued demand for logistics and high-specs sectors in Singapore for the rest of the year, it cautioned that the pace of growth could moderate in 2023 amid softening sentiments alongside mounting global risks.
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In Australia, it noted a slight fall in national vacancy rates and an increase in rents by a new record high led by Sydney.
Units of ESR-Logos Reit closed Tuesday S$0.01 or 3.1 per cent higher at S$0.33.
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