AIMS APAC REIT (AA REIT) has recorded a distribution per unit (DPU) of 2.9 cents for the 4QFY2021 ended March, up 41.5% y-o-y. Distributions to shareholders totalled $20.5 million for the period.
This brings FY2021 DPU to 8.95 cents, representing a 5.8% decline y-o-y from 9.5 cents previously. Distributions to shareholders fell 4.9% y-o-y to $63.2 million for the year.
The lower distribution was mainly due to lower net property income and management fees paid fully in cash for FY2021, though partially offset by the full release of the Australian distributable income of $2.9 million previously retained in the 4QFY2020.
AA REIT’s gross revenue grew 3.2% y-o-y to $122.6 million for FY2021, driven by full-year contribution from Boardriders Asia Pacific HW which was acquired in July 2019, the newly redeveloped 3 Tuas Avenue 2, and 7 Bulim Street which was acquired in October 2020.
Net property income (NPI), however, fell 1.7% y-o-y to $87.5 million due to rental relief of $1.7 million, lower contributions from 1A International Business Park from the conversion of its master lease to multi-tenancy leases, and lack of contribution from 541 Yishun Industrial Park A after its master lease expired in April 2020, before a new master tenant commenced contributions from January.
Share of profits of joint ventures (net of tax) also fell 42.1% y-o-y to $35.4 million from $61.1 million previously mainly due to the lower share of revaluation surplus recognised from the valuation of Optus Centre.
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AA REIT’s portfolio occupancy as at March 31 stood at 95.4%, a 0.3 percentage point decrease q-o-q, but 6 percentage points higher y-o-y from 89.4% previously, driven by the acquisition of 7 Bulim Street. Weighted average lease of expiry is 3.95 years.
Koh Wee Lih, CEO of the manager, says that the REIT’s portfolio remains resilient. ‘“We continue to see high resiliency across our portfolio, underpinned by quality assets, with over 50% of tenants in the essential services.”
37 new and renewal leases representing 103,965 sqm or 14.0% of total net lettable area were executed in the 4QFY2021. The manager of AA REIT expects occupancy to be sustained, driven by strong demand for logistics and warehouse facilities from e-commerce, stockpiling and shifts in supply chain.
Cash and cash equivalents stood at $11.2 million as at March 31, while AA REIT’s aggregate leverage was 33.9%.
In terms of its market outlook, the manager notes that the ramp-up in Singapore’s vaccination programme is expected to support Singapore’s economic growth, though this will be subject to any potential resurgence of the virus. Citing JTC Corporation’s market report for 1Q2021, the manager anticipates demand for industrial space to increase, while price and rentals are likely to remain stable.
For Australia, the manager notes that the economic recovery is stronger than had been expected, though the economy is "still operating with spare capacity".
AA REIT’s distribution is expected to be paid out on June 24.
Units in AA REIT closed 1 cent or 0.73% lower at $1.37 on May 4.
