Ascendas REIT reports 1H21 net property income rose 15 percent on acquisitions

Ascendas REIT’s Techview property located in the Kaki Bukit Industrial Area in SingaporeAscendas REIT’s Techview property located in the Kaki Bukit Industrial Area in Singapore

Ascendas REIT reported Monday its first half net property income increased 14.8 percent on-year to S$445.6 million as the number of properties in the portfolio rose to 211, up from 197 in the year-earlier period.

Gross revenue for the January-to-June period rose 12.4 percent on-year to S$586 million, the REIT said in a filing to SGX.

The distribution per unit (DPU) for the first half was 7.66 Singapore cents, up 5.4 percent on-year even as the number of units increased by 12.2 percent on-year, the REIT said.

The increased earnings were mainly on the acquisition of two office properties in San Francisco, in the U.S., in November 2020, and 11 data centers in Europe, acquired in March 2021, as well as two suburban offices in Australia, acquired in September 2020 and January 2021, the REIT said. The revenue gains, however, were partly offset by the absence of S$10.3 million in Covid-related grants from the Singapore government in the year-ago period, the REIT said.

Overall portfolio occupancy improved to 91.3 percent in the second quarter from 90.6 percent in the first quarter, mainly on improvements in the Singapore and Australia properties, the REIT said.

In the second quarter, the portfolio posted positive average rental reversion of 8.9 percent for leases renewed in multi-tenanted buildings, up from 3 percent in the first quarter.

The REIT issued a cautious outlook.

“Whilst the global economic outlook for 2021 is expected to be brighter compared to 2020, the pace of business recovery is likely to vary across sectors and geography,” the REIT said. “The manager will continue to exercise prudence, maintain a strong balance sheet and proactively manage its S$15.9 billion portfolio to deliver sustainable returns for its unitholders.”