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AA REIT declares 4.6% increase in 4Q DPU to 2.75 cents

Samantha Chiew
Samantha Chiew • 2 min read
AA REIT declares 4.6% increase in 4Q DPU to 2.75 cents
SINGAPORE (Apr 24): The manager of AIMS APAC REIT (AA REIT) announced a DPU of 4Q19 of 2.75 cents, 4.6% higher than the 2.75 cents declared in 4Q18.
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SINGAPORE (Apr 24): The manager of AIMS APAC REIT (AA REIT) announced a DPU of 4Q19 of 2.75 cents, 4.6% higher than the 2.75 cents declared in 4Q18.

Distribution to unitholders for 4Q19 increased 5.7% y-o-y to $19 million from $18.0 million.

This brings FY19 DPU to 10.25 cents, a slight 0.5% lower than 10.30 cents recorded in FY18.

Gross revenue for the quarter was 6.7% higher at $30.0 million from $28.0 million a year ago, mainly due to maiden rental contribution from the property at 51 Marsiling Road from April 27, 2018 and higher rental and recoveries for the properties at 8 Tuas Avenue 20, NorthTech, 8 & 10 Pandan Crescent and 20 Gul Way.

As property operating expenses dropped 7.4% y-o-y, net property income for 4Q19 was 15.0% higher at $20.3 million, compared to $17.7 million in 4Q18.

During the quarter, share of results of joint venture more than doubled to $13.4 million from $6.4 million last year. This mainly comprises the REIT’s 49% interest in Optus Centre, Australia. The higher contribution in 4Q19 was mainly due to the share of revaluation surplus recognised from the valuation of the underlying property. As at Mar 31, the independent valuation of the underlying property was valued at A$470.0 million ($455.7 million), compared to A$450.0 million valued in 4Q18.

The REIT recorded a loss from net change in fair value of investment properties and investment property under development of $18.3 million, compared to a gain or $2.1 million a year ago, arose mainly from the revaluation of the trust’s 25 Singapore properties.

During the quarter, the manager successfully executed 11 new and renewal leases representing 21,388 sqm (3.4% of total lettable area). Portfolio occupancy remained stable at 94.0%.

Koh Wee Lih, CEO of the manager, says, “Although challenges remain in the operating environment, there are signs that the industrial market is stabilising. Combined with our proactive approach to asset and lease management and strong capital structure, we are well positioned to capitalise on future growth opportunities to drive long-term, sustainable returns.”

“We continue to strengthen the quality and returns of our portfolio to ensure we remain ahead of changes in market conditions. Our redevelopment at 3 Tuas Avenue 2 and asset enhancement initiative at NorthTech are both on track for completion in the second half of the year and will further future-proof AA REIT as we work to adapt to changing tenant needs,” adds Koh.

Units in AA REIT last traded at $1.40 on Tuesday.

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