Daiwa House Logistics Trust has reported a distribution per unit (DPU) of 1.31 cents for the 1QFY2022 ended March. The DPU stood 0.8% higher than the pro-rated forecast of 1.30 cents.
During the quarter, gross revenue stood at $16.8 million, 0.8% lower than the pro-rated forecast of $16.9 million.
Net property income (NPI) stood 1.4% higher than the pro-rated forecast at $13.3 million.
Distributable income, too, stood 0.6% higher than estimates at $8.9 million.
During the quarter, the REIT had entered into, as well as renewed new leases with an unchanged rent to rent increase of 2.0%. The figure is based on the monthly rent compared against the preceding lease for the same space.
The new lease entered into is on a 10-year term. It also comes with a clause for the re-negotiation of rent at the end of the fifth year.
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As at end-March, the REIT reported an overall portfolio occupancy of 98.6%, where all properties except one stood at full occupancy.
According to the REIT manager, its portfolio has continued to demonstrate resilience with no request for any form of rental relief or abatements to date amid the Covid-19 pandemic.
The REIT’s weighted average lease expiry (WALE) stood at 6.8 years by net lettable area (NLA) sa at end-March.
“We are pleased that the overall occupancy of the portfolio has improved to 98.6%... We will continue to work with the property manager to lease the vacant space,” says Takeshi Fujita, CEO of the manager.
“With the signing and extension of leases, including the lease signed in April 2022, there is only 15.4% of space remaining for renewal in 2022 for multi-tenanted properties, and there are no leases expiring for built-to-suit properties in 2022,” he adds.
As at end-March, the REIT’s aggregate leverage stood at 38.2%.
Looking ahead, the REIT manager says a large supply of logistics facilities in Japan is expected in 2022 and 2023, with most of them located in the Greater Tokyo area.
“As a result of such supply, vacancy rates may increase with rental growth expected to be moderated. Further, with the upcoming supply, logistics facilities that are older and which are poorly located may face challenges,” says the REIT manager in its May 12 statement.
It adds that it remains positive on the outlook of logistics sector in Japan. It believes that the sector “will continue to be supported by the resilient third-party logistics (3PL) and e-commerce sectors in the near term, but concurrently, it is also cautious of the challenges amidst the increase in supply”.
As at 10.53am, units in Daiwa are trading 1.5 cents lower or 1.86% down at 79 cents.
