The manager of Daiwa House Logistics Trust (DHLT) announced a distribution per unit (DPU) of 0.49 cents for the period of Nov 26 to Dec 31, 2021, in its business update released on Feb 11.
The DPU stood in line with the 0.49 cents forecast disclosed in its initial public offering (IPO) prospectus.
During the period between Nov 26 to Dec 31, 2021, the REIT saw gross revenue inch up by 0.7% to $6.6 million.
Net property income (NPI) increased by 2.4% to $5.3 million, while distributable income stood 0.4% up at $3.3 million.
In its business update, the REIT revealed that its initial portfolio of 14 properties were revalued to 81.07 billion yen ($947.7 million), resulting in a net asset value (NAV) per unit of 92 cents as at Dec 31, 2021.
The REIT, which listed on Nov 26, 2021, was the first REIT IPO in 20 months on the Singapore Exchange (SGX).
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Its initial portfolio comprised 14 logistics properties in Japan with a net lettable area (NLA) of 423,920 sq m and a total land area of approximately 420,393 sq m. Of these, six are freehold, and eight are leasehold with average land tenure of 38.3 years. In terms of NLA, 48.3% is freehold and 51.7% leasehold.
As at November 2021, the appraised value of the IPO portfolio stood at around 80.67 billion yen ($952.9 million), which was acquired for 71.07 billion yen ($840.5 million) on its listing date.
As at Dec 31, 2021, the REIT’s overall portfolio occupancy remained high at 96.3%. There were no requests for any form of rental relief or abatements amid the Covid-19 situation, says the manager.
That said, the manager adds that it will “work closely with the property manager” to lease out the vacant space. It is also currently in negotiations with potential tenants.
DHLT’s distribution policy is to distribute 100.0% of its annual distributable income for the period from the listing date to Dec 31.
The first distribution, which will span from Nov 26, 2021 to June 30, will be paid on or before Sept 30.
Takeshi Fujita, CEO of the manager, says “As a demonstration of support and commitment from the sponsor, Daiwa House Industry Co., Ltd., the portfolio was acquired from the Sponsor at a substantial discount of 11.8% to its aggregate valuation as at June 30, 2021, and was initially recorded based on the purchase consideration in the pro forma financials.”
“The portfolio valuation as at Dec 31, 2021 represented an uplift of 14.1% from the purchase consideration of the portfolio. The revaluation also resulted in aggregate leverage of 37.7% compared to 43.8% as at June 30, 2021 based on pro forma financials,” he adds.
As at Dec 31, 2021, the REIT’s aggregate leverage stood at 37.7%.
The REIT manager remains positive on the demand for logistics space in Japan despite the emergence of the Omicron variant.
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“Looking ahead, [a] large supply of logistics space is expected over the next two years in certain markets, particularly in Greater Tokyo, which may result in increasing vacancy and moderation of rental rates growth in these markets,” says the manager in its Feb 11 statement.
“However, demand is expected to remain robust in general with the continual expansion of Japan’s e-commerce market a major contributing factor,” it adds.
Units in DHLT closed at 81 cents on Feb 10.
Photo: DHLT
