Frasers Logistics Trust reports fiscal 3Q net property income rose 21 percent

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Frasers Logistics & Industrial Trust reported Friday its fiscal third quarter net property income rose 20.7 percent on-year to A$49.64 million (S$46.97 million or US$34.30 million) on acquisitions in Europe and Australia.

Revenue for the quarter ended 30 June increased 21.6 percent on-year to A$59.95 million, the trust said in a filing to SGX.

The distribution per unit (DPU) was 1.82 Australian cents, up 3.4 percent from 1.76 Austalian cents in the year-ago period, the filing said. In Singapore dollar terms, the DPU was 1.73 Singapore cents, down 3.9 percent from 1.80 Singapore cents in the year-ago period.

In November 2018, the trust said it would acquire a property in the Netherlands, and in September 2018 it set a deal to acquire two properties in Australia.

“We are pleased to turn in a solid third quarter performance,” Robert Wallace, CEO of the REIT manager, said in the statement.

“It was also a busy period for FLT in which we continued with our active asset management strategies, completing two forward lease renewals in Australia and Germany, divesting a non-core property in Victoria, as well as the sale of a 50 percent interest in the Coles Facility,” Wallace added. “These portfolio optimisation initiatives are expected to provide further income stability and reduce tenant concentration.”

The portfolio’s occupancy was at 99.5 percent as of end-June, the filing said, adding there were no remaining lease expiries for the current financial year.

For the nine-month period, the trust reported net property income rose 33.4 percent on-year to A$148.86 million on revenue of A$179.14 million, up 32.4 percent on-year. The DPU for the nine-month period was 5.45 Australian cents, up 5.6 percent from 5.16 Australian cents in the year-ago period, the filing said.

In its outlook, the REIT was cautious.

“The REIT manager continues to monitor key macro developments, including the ongoing global trade tensions and Brexit,” the filing said. “Looking ahead, the REIT manager will remain focused on its proactive asset and lease management strategies and will continue to grow FLT’s prime industrial portfolio.”

In Australia, industrial take-up levels remained “robust,” amid demand from retail, third-party logistics and logistics occupiers, Frasers Logistics Trust said, adding industrial vacancy rates remained at five-year lows in the Sydney, Melbourne and Brisbane markets.

In Germany and the Netherlands, take up for logistics and industrial properties over 5,000 square meters remained high in the first half of 2019, the filing said.

The trust’s portfolio has 81 logistics and industrial properties across Australia, Germany and the Netherlands.

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