ESR-REIT posts 1H21 net property income rose 8.4 percent

ESR-REIT reported Friday its first half net property income rose 8.4 percent on-year to S$87 million, mainly on the absence of S$4.6 million in Covid-19 rental rebates to tenants in the year-ago period.

The distribution per unit (DPU) increased 14.3 percent on-year to 1.554 Singapore cents, even as it was spread across 3.65 billion units, up 3.8 percent on-year, the REIT said in a filing to SGX. The DPU for the second quarter rose 13.9 percent on-year to 0.754 Singapore cents, the filing said.

Gross revenue increased 5.4 percent on-year to S$119.8 million, the filing said.

Daiwa had forecast the DPU to come in at 1.549 Singapore cents, with revenue at S$117.0 million and net property income at S$88 million.

Portfolio occupancy in the second quarter increased to 91.7 percent from 90.8 percent in the previous quarter, above the JTC average of 90 percent in the first quarter, on the completion of the 46A Tanjong Penjuru acquisition and improvement in the portfolio overall, the REIT said.

Adrian Chui, CEO and executive director of the manager, said the first half showed a relatively stable operating performance.

The outlook was mixed.

“Due to the tightening measures under P2(HA) [phase two heightened alert], completion of new industrial space has been further delayed to 2H2021 and 2022, directly impacting rents and prices in the coming quarters,” the REIT said. “The manager remains cautiously optimistic despite the prolonged uncertainties arising from the evolving Covid-19 variants and its economic impact on the industrial market over the short to medium term.”

ESR-REIT holds interests in a portfolio of 58 properties in Singapore with an aggregate property value of S$3.2 billion across the business park, high-specs industrial, logistics/warehouse and general industrial segments. The REIT also holds a 10 percent stake in ESR Australia Logistics Partnership, a private fund holding 37 mainly logistics properties in Australia.