SINGAPORE (April 27): The manager of AIMS AMP Capital Industrial REIT (AA REIT) has declared a distribution per unit (DPU) of 2.78 cents for the fourth quarter ended March 31, decline 5.8% from 2.95 cents in the same quarter a year ago.
This brings the trust’s DPU for the full year to 11.05 cents, 2.6% lower from the 11.35 cents for FY16.
Gross revenue over the quarter grew 0.8% to $30.6 million from $30.4 million in the previous year, mainly due to the maiden contribution from the newly-completed property at 30 Tuas West Road from 27 Feb this year as well as higher rental contributions from the property at 27 Penjuru Lane.
The higher overall revenue was partially offset by lower rental and recoveries from 20 Gul Way, as two phases of the property reverted to multi-tenancy leases on 28 Dec 2016 and 13 Feb 2017.
Property operating expenses were $10.6 million for 4Q17, 7.2% higher on-year from $9.9 million in 4Q16 as a result of higher expenditure to maintain the properties, in addition to higher costs arising from the reversion of the two phases of 20 Gul Way to multi-tenancy leases.
As such, net property income for the quarter declined 2% on-year to $20 million from $20.4 million a year ago.
As at March 31, portfolio occupancy was 94.6%, which the manager says continues to be above the industry average.
AA REIT currently has two ongoing development projects, namely 8 & 10 Tuas Avenue 20 and a greenfield development at Marsiling, which are targeted to complete in 2H17.
Citing an uncertain macroeconomic and geopolitical outlook and the industrial oversupply situation in Singapore, AA REIT’s manager expects rentals to continue facing pressure, and that it will remain focused on managing risks through prudent capital management.
It also aims to optimise the portfolio through sector and tenant diversification.
Units of AA REIT closed flat at $1.40 on Wednesday.
