Cromwell European REIT posts 1H19 net property income jumped 34 percent

Euro coinsPhoto by Leslie Shaffer

Correction: This item has been updated to correct the on-year change of the distribution per unit (DPU). The DPU rose 3.0 percent on-year in the first half.

Cromwell European REIT reported Thursday its first half net property income climbed 33.7 percent on-year to 54.13 million euros (S$83.93 million or US$60.68 million), mainly on the acquisition of 22  new properties acquired in late 2018 and early 2019.

Gross revenue for the six months ended 30 June increased 32.5 percent on-year to 82.37 million euros, the REIT said in a filing to SGX.

The distribution per unit (DPU) for the first half was 2.04 European cents, up 3.0 percent from 1.98 European cents in the year-ago period, the REIT said. The DPU was 4.6 percent above the forecast from the IPO prospectus, the REIT said.

Simon Garing, CEO of the REIT manager, said Cromwell European REIT benefited from the property acquisitions and from securing new tenant-customers earlier in the year.

“We also recorded positive rental reversions on average, fueled primarily by the light industrial / logistics properties in the portfolio,” Garing said in the statement. “This validates the efficacy of our barbell approach, whereby the security that CEREIT’s office assets provide is balanced with the growth potential of its light industrial / logistics assets, especially from last-mile e-commerce urban warehouse tenant-customers.”

In its outlook, the REIT pointed to expectations the Eurozone economy would grow by 1.2 percent on-year in 2019, with resilience in the labor market and the unemployment rate at a decade-low of 7.5 percent.

Cromwell European REIT’s portfolio held 97 properties as of end-June.

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