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The average distribution per unit (DPU) of five of the seven industrial real estate investment trusts (REITs) that have released their earnings for the quarter that ended 31 March has gone down as industrial space supply exceeds demand, data from a Singapore Exchange My Gateway report revealed Wednesday (4 May).
According to the report, average DPU for the REITs was down to 2.1 Singapore cents from 3.5 percent the same period last year. The REITs that reported their results last week include Viva Industrial Trust, Mapletree Industrial Trust, Mapletree Logistics Trust, AIMS AMP Capital Industrial REIT and Cambridge Industrial Trust,
“In terms of DPUs, Viva Industrial Trust registered the sharpest year-on-year (y-o-y) decline of 12.4 percent to 1.64 cents. This was followed by Cambridge Industrial Trust, with a fall of 9.2 percent y-o-y to 1.11 cents, and Mapletree Logistics Trust, with a slide of 2.7 percent y-o-y to 1.80 cents,” the report said.
Meanwhile, Mapletree Industrial Trust posted the highest y-o-y DPU increase – up 6.0 percent to 2.81 cents.
On average, these trusts posted a 7.9 percent gain in net property income to S$38.5 million, while gross revenue rose an average 7.1 percent to S$50.6 million.
In the year so far, these REITs have averaged a price gain of 2.8 percent, with dividends boosting total returns to 5.0 percent. The five trusts also maintain an average dividend yield of 7.9 percent and have a combined market capitalisation of S$7.7 billion.
“On average, the five REITs had an aggregate leverage ratio of 35.0 percent as of 31 March. This compares with an average of 35.1 percent as at 31 December. Interest cover for the five trusts averaged 5.4 times in the March quarter, compared with an average of 5.5 times in the December quarter,” the report said.
In the March quarter, Mapletree Logistics Trust had the highest leverage ratio at 39.6 percent, followed by Viva Industrial Trust and Cambridge Industrial Trust at 37.6 percent and 37.1 per cent, respectively. Meanwhile, Mapletree Industrial Trust had the lowest leverage ratio of 28.2 percent.
The report added that weighted average debt maturity periods for the five trusts averaged 3.3 years as at the end of March, compared with 2.9 years at the end of December.
Looking ahead, these REITs hold a cautious outlook with some expecting the market to remain challenging on the back of a muted global economic prospects and the large supply of industrial space here.
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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