First Reit keeps Q3 DPU flat at 2.15 S cents

HEALTHCARE real estate investment trust First Reit will pay out a distribution per unit (DPU) of 2.15 Singapore cents for the third quarter, unchanged from the same period the year before, manager Bowsprit Capital Corp said in results released on Wednesday.

Distributable income was up by 1.3 per cent year-on-year to S$17.2 million for the three months to Sept 30, even as net property income slipped by 2.5 per cent to S$28.2 million on higher property expenses in South Korea and Indonesia.

In all, First Reit - which manages 20 healthcare properties such as hospitals and nursing homes in Indonesia, Singapore and South Korea - saw rental and other income dip by 1.5 per cent to S$28.8 million, because of a lower variable rental component for its Indonesia projects.

For the nine months, DPU was stable at 6.45 Singapore cents. Net property and other income dipped by 1.5 per cent to S$84.6 million and rental and other income inched down 0.5 per cent to S$86.4 million.

The weighted average lease expiry of the portfolio was 7.8 years as at Sept 30, with 100 per cent committed occupancy, while First Reit's gearing stood at 34.5 per cent, compared with 35 per cent as at Dec 31, 2018, with the weighted average debt maturity at 2.26 years.

The manager, which is owned by OUE and OUE Lippo Healthcare, noted in an outlook statement that First Reit continues to be presented with opportunities for yield-accretive acquisitions from a strong pipeline of quality healthcare assets in Indonesia and across the Asia-Pacific region, and cited the trust's right of first refusal for acquisitions from sponsors Lippo Karawaci and OUE Lippo Healthcare.

The books closure date is Nov 14, with the third-quarter DPU to be paid out on Dec 17.

First Reit units closed up by S$0.01 or 0.96 per cent to S$1.05 on Wednesday before the results were released.