SINGAPORE (Oct 23): The manager of First Real Estate Investment Trust (First REIT) has reported a 0.9% rise in distribution per unit (DPU) to 2.14 cents for the 3Q ended September, from 2.12 cents a year ago.
Gross revenue grew 3.3% to $27.8 million, from $26.9 million a year ago. This was mainly due to full-quarter contribution from Siloam Hospitals Labuan Bajo, which was acquired in December 2016.
In addition, gross revenue was lifted by higher rental income from existing properties in Indonesia, Singapore and South Korea.
Net property income (NPI) increased by 3.2% to $27.5 million, from $26.6 million a year ago while distributable income for 3Q17 rose 2.2% to $16.7 million, from $16.3 million a year ago.
Looking ahead, CEO of the manager Victor Tan says the trust has recently completed the acquisition of an integrated property comprising Siloam Hospitals Buton and Lippo Plaza Buton in Indonesia, and is also working on a joint venture with Lippo Malls Indonesia Retail Trust to jointly acquire another integrated development in Yogyakarta.
“With the Buton property, and potentially another new-quality asset, unitholders can look forward to a steady income stream that will continue to deliver consistently growing DPU,” Tan says.
Tan adds that First REIT’s low gearing of 32.6% as at end September gives it ample debt headroom to carry out more acquisitions to further strengthen its portfolio.
“The trust has the right-of-first-refusal to a healthy pipeline of around 40 hospitals from our sponsor, PT Lippo Karawaci Tbk,” he says. “Along with stronger economic growth prospects, the national health insurance scheme will continue to drive demand for better quality private healthcare among the rising middle-income class in Indonesia.”
Units in First REIT closed 1 cent higher at $1.38 on Monday.