(Mar 25): Ascott Residence Trust’s (Ascott REIT) portfolio composition has changed subtly over the years. In 2015, for instance, China was its largest exposure, accounting for 17% of its portfolio by asset size, followed by Japan with 15.9% and Singapore at 13.3%. As at Dec 31, 2018, Singapore was the largest with 20.3%, followed by Japan at 12.8% and the US at 12.5%. In terms of gross operating profit (GOP, the equivalent of net property income), the US contributed 16.3%, followed by Japan with 13%, and France with 12%.
Beh Siew Kim, CEO of Ascott REIT’s manager, says: “Over the years, Ascott REIT has moved from pan-Asia to Europe and, in 2015, to the US. We have moved from Asia-Pacific contributing to our income… to deriving more than 75% of our income from developed countries today. So, there is a probability of getting ourselves into the FTSE EPRA/NAREIT Global Real Estate Index as we continue to increase our investment in developed markets.”
In FY2018, Ascott REIT’s earnings before interest, taxes, depreciation and amortisation (Ebitda) according to the FTSE classification of markets was 75% for developed markets. To qualify for inclusion in the FTSE EPRA/NAREIT Index, a company must report 75% of Ebitda from developed markets for two consecutive years, and have a healthy free float. Once in, Ebitda from developed markets is set at 50%.
