Ascendas Real Estate Investment Trust (A-REIT) has announced a 11.7% y-o-y increase in net property income to $81.1 million for 2Q FY09/10 due to an enlarged portfolio compared to $97.3 million for 2Q FY08/09. Distributable income increased by 15.4% to $61.6 million from a year ago.
However, DPU for the quarter fell 13.2% to 3.48 cents for the quarter from 4.01 cents a year ago.
Reflecting the severe global recession, A-REIT says occupancy rate declined marginally to 96.8% from 97.1% a quarter ago. For its multi-tenanted properties, occupancy moderated to 93.3% from 94.0%.
In 2Q FY2009/10, A-REIT successfully redeemed its P1-AAA-001 Commercial Mortgage Backed Securities at their principal amount of €144 million ($300 million) with existing unsecured credit facilities. With this redemption, A-REIT’s financial flexibility is significantly enhanced as the number of unencumbered properties in the portfolio increase to 31 properties worth approximately $2 billion. The nearest refinancing requirement is a $300 million term loan facility in March 2010 which A-REIT says it has received an offer to extend the loan.
In August, A-REIT raised new equity of approximately $300 million. The proceeds are to partly fund the development of a built-to-suit Hi-tech Industrial facility for SingTel with the remaining 40% for potential investment opportunities.
A-REIT’s current aggregate leverage is 30.5% with an interest cover of about 4.8 times. After completion of the development for SingTel expected in 1Q 2010, A-REIT’s aggregate leverage is expected to be about 31.9%.
During the quarter, A-REIT completed two development projects, namely, a logistics facility at the Airport Logistics Park of Singapore for Expeditors Singapore Pte Ltd and Phase 2 of Plaza 8 Changi Business Park which is a multi-tenanted building with an amenity centre at about 7.3% below budgeted development cost. As at Sept 30, 2009, A-REIT has a portfolio of 90 properties with a total asset value of about $4.7 billion, housing a tenant base of about 900 international and local companies.
Source : The Edge – 19 Oct 2009