SABANA Industrial Real Estate Investment Trust : M1GU 0% (Sabana Reit) posted a distribution per unit (DPU) of 1.46 Singapore cents for the half-year ended Dec 31, 2022, down 7 per cent from a year earlier.

In a bourse filing on Monday (Jan 30), its manager attributed the DPU decline to higher interest expenses.

Gross revenue rose 16.9 per cent to S$50.1 million from S$42.8 million, mainly due to higher contributions from New Tech Park as well as the portfolio’s assets at Tuas, Chai Chee Lane, Serangoon North and Changi South.

Net property income (NPI) remained stable at S$26.3 million, remaining consistent year on year. 

The latest H2 results brings the Reit’s FY2022 DPU to 3.05 cents, unchanged from the previous year.

FY2022 gross revenue was up 15.9 per cent to S$94.9 million from S$81.9 million in FY2021, while NPI rose 2.6 per cent to S$53.3 million as the full-year increase in revenue was largely offset by a surge in utility expenses amid global energy inflation.

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As at end-December 2022, the Reit’s portfolio’s occupancy rate stood at 91.2 per cent excluding occupancy data from 1 Tuas Avenue 4, which is undergoing asset enhancement initiative works. This is 2.8 percentage points higher than the previous year’s, driven primarily by positive rental reversion rates in Q4.

Sabana Reit’s portfolio valuation for its 18 properties saw a further uplift by 2.3 per cent on-year to S$885.7 million as at end-2022, due to higher signing rents for both new and renewed leases across the portfolio as well as the securing of a new master lease tenant at 30 & 32 Tuas Avenue 8.

With an aggregate leverage of 32.4 per cent as at end-2022, the Reit has a debt headroom of S$156.1 million with a weighted average debt maturity at 2.8 years. The next refinancing requirement is due in Q4 of 2024.

Looking ahead, the manager said it remains cautiously optimistic on its mid-term outlook, and continues to see steady demand in the Singapore industrial sector.

Units of Sabana Reit ended Friday unchanged at S$0.45.