Aims Apac Reit’s 9M DPU rises 1.1% to S$0.0707

THE manager of Aims Apac Reit (AA Reit) on Tuesday (Jan 28) posted a 1.1 per cent increase in distribution per unit (DPU) to S$0.0707 for the nine months ended Dec 31, 2024, from S$0.0699 in the same period the previous year.

Revenue climbed 5.7 per cent on the year to S$139.1 million from S$131.6 million. This was supported by continued rental reversions from the logistics and industrial segments, but was offset by higher expenses such as property tax and electricity costs.

As a result, net property income (NPI) rose 1.9 per cent to S$99.6 million from S$97.8 million.

Distributions to unitholders increased 4.3 per cent to S$57.5 million from S$55.1 million. They will be paid on Mar 26, after the record date on Feb 10.

Russell Ng, chief executive of AA Reit’s manager, noted that there is ongoing progress on the two asset enhancement initiative (AEI) projects at 7 Clementi Loop and 15 Tai Seng Drive, of which long-term leases to master and anchor tenants have been secured.

Both AEIs are expected to be completed in the first quarter of FY2026. They are expected to yield more than 7 per cent in NPI.

“The proposed divestment of 3 Toh Tuck Link at a premium is further in line with our asset management strategy to divest non-core assets and recycle capital into new growth opportunities and other strategic initiatives.”

For 9M FY2025, the manager of AA Reit secured 19 new leases and 41 renewal leases. This helped the real estate investment trust to achieve a rental reversion rate of 21.2 per cent.

Overall portfolio occupancy stood at 94.5 per cent as at Dec 31, 2024, down from 98.1 per cent as at Dec 31, 2023. Excluding the impact from ongoing AEIs and transitory movements by tenants, the portfolio occupancy rate based on committed leases was 96.3 per cent.

Weighted average lease expiry stood at 4.7 years, while gearing was up slightly at 33.7 per cent, from 32.2 per cent as at end-December 2023. No debt refinancing is needed until FY2027, and undrawn committed facilities and cash and bank balances stood at about S$200.5 million, the manager noted.

It added that 70 per cent of debt is on fixed rates, and the average fixed debt tenure is around 1.5 years.

Looking ahead, the manager said that high-tech spaces in Singapore continue to see demand from life sciences and technology firms, while warehouse spaces continue to be absorbed by third-party logistics companies.

For its assets in Australia, it noted that they are “anchored by quality tenants on long lease terms and built-in annual rental escalations”, on the back of long-term infrastructure works, as well as government investments.

Units of AA Reit ended Monday flat at S$1.27.