ESR-Reit DPU up 14.8% to 0.8 S cent for Q1

ESR-REIT on Thursday posted a core distribution per unit (DPU) of 0.8 Singapore cent for the three months ended March 31, up 14.8 per cent from 0.697 cent the year before.

Gross revenue was up 4.4 per cent to S$60.3 million for the first quarter, from S$57.8 million the year prior. This was mainly due to the absence of provision for Covid-19 rental rebates to tenants and lower property expenses, the manager said in a bourse filing on Thursday.

For the same reason, net property income grew 7.6 per cent on the year to S$44.1 million for the quarter, from S$41 million.

The lower property expenses was mainly due to lower utilities expenses from lower contracted electricity rates at certain properties and the reduction of electricity consumption at common areas of the properties, as well as lower maintenance costs in relation to safe management measures.

Total income available for distribution rose 17.1 per cent year on year to S$28.7 million, from S$24.5 million. This amount includes S$1.8 million in management fees payable to the manager and property manager, lower than the S$2.2 million paid for Q1 2020.

The distribution will be paid out on June 24, after the books closure date on April 30.

The manager said rental collection for Q1 2021 was 97.5 per cent of total receivables, in line with pre-pandemic levels. The portfolio has a weighted average lease expiry of 2.9 years, the occupancy rate meanwhile, was 90.8 per cent in the quarter. No rental rebates were provided to tenants in the first quarter. Tenants have also gradually resumed rental payments, previously deferred under the Covid-19 (Temporary Measures) Act 2020.

During this period, there were 32 leasing transactions for 317,000 square feet (sq ft) of space. Of this amount, 182,000 sq ft were for new leases and 135,000 sq ft were for renewals.

Adrian Chui, chief executive and executive director of the manager, said: "Notwithstanding the widespread impact of Covid-19, Q1 2021 has been characterised by increased leasing momentum, strong rental collections and ongoing initiatives to enhance our portfolio quality."

He said the manager will continue to improve the real estate investment trust's portfolio via asset enhancement initiatives and/or redevelopments, taking into consideration industrialists' requirements, expectations and preferences to ensure that the portfolio remains future-ready.

The rebranded UE BizHub East, now known as ESR BizPark @ Changi, completed asset enhancement initiatives with temporary occupation permit obtained on March 31. Workspaces were reshaped in response to work from home arrangements. Amenities and traffic circulation were also improved.

ESR-Reit units closed flat at 40.5 Singapore cents on Thursday.