The manager of AIMS APAC REIT (AA REIT) has reported distribution per unit (DPU) of 2.50 cents for the 2QFY2022 ended September, 25% higher than the DPU of 2.00 cents reported in 2QFY2021.

This brings DPU for the 1HFY2022 to 4.75 cents, which is 18.8% higher than the DPU of 4.00 cents in the 1HFY2021.

Distributions to unitholders for the half-year period stood 18.9% higher y-o-y at $33.6 million.

The better performance was mainly attributable to the higher net property income (NPI) during the period.

1HFY2022 gross revenue increased by 13.0% y-o-y mainly due to the REIT’s newly acquired property on 7 Bulim Street on October 2020.


See: RHB ups AIMS APAC REIT's TP to $1.72 on strong fundamentals


mute
The higher gross revenue was also due to higher rental and recoveries for the properties at 20 Gul Way, 8 & 10 Pandan Crescent and 541 Yishun Industrial Park A.

In addition, the lower gross revenue in the same period the year before was due to an estimated provision for waiver of rent for eligible tenants under the Singapore relief rental framework.

Property operating expenses in the 1HFY2022 fell slightly at 1.36% y-o-y to $17.5 million.

Accordingly, NPI increased by 19.4% y-o-y to $47.7 million.

During the period, share of profits of joint venture surged 3.57 times to $27.3 million mainly due to higher share of revaluation surplus recognised from the $19.4 million valuation of Optus Centre, compared to the $0.9 million valuation in the year before.

The valuation for Optus Centre in Australia as at end-September rose by 6.2% h-o-h to A$701.0 million ($686.7 million).

As at Sept 30, AA REIT’s portfolio occupancy increased 1.6 percentage points q-o-q to 97.3%, while its weighted average lease expiry (WALE) stood stable at 3.98 years.

Over the six-month period, the REIT’s properties in Singapore and Australia recorded a total net revaluation gain of $37.1 million, representing an increase in net asset value (NAV) of around 5 cents per unit.

As at Sept 30, cash and cash equivalents stood at $108.3 million.


For more stories about where the money flows, click here for our Capital section


On the results, the manager’s CEO-designate Russell Ng says the REIT’s broadening of its portfolio and geographical diversity “will enable us to stay resilient amidst the global pandemic”.

“Our proposed acquisition of Woolworths HQ represents our third investment into Australia, and will further strengthen AA REIT’s foothold in Sydney’s resilient business park market,” he says.

“Our high quality asset base also continues to be driven by the logistics and warehouse sector, which represents just over half of the portfolio. Looking ahead, we are committed to seeking out quality assets that align with our investment criteria, which include stable income, annual rental escalations, long-term capital appreciation, and redevelopment potential.”

“The proposed acquisition of Woolworths HQ is transformational and will be the largest asset in AA REIT’s high-quality portfolio. This business park property is wholly-leased for 10 years to Woolworths, Australia’s largest supermarket retailer and one of largest companies listed on the Australian Securities Exchange Ltd,” adds George Wang, chairman of the manager.

“Longer term, the site provides the Manager with future re-development potential to add a further circa 135,000 sqm (1.5 million sqft) of gross floor area (GFA_. This is in addition to the potential to tap on unutilised GFA of more than 500,000 sq ft within AA REIT’s Singapore portfolio,” he continues.

Unitholders will receive their distributions on Dec 17.

Units in AA REIT closed flat at $1.46 on Oct 12.

Photo: AA REIT