Daiwa House Logistics Trust post net property income slightly above view

Japanese 1,000 yen notesJapanese 1,000 yen notes

Daiwa House Logistics Trust (DHLT) reported Friday its net property income for the period from its listing date on 26 November to 31 December came in at S$5.26 million, 2.4 percent above the pro-rated forecast for the period from its initial public offering (IPO) prospectus

Gross revenue for the period came in at S$6.60 million, up 0.7 percent from the prospectus forecast, the trust said in a filing to SGX.

The distribution per unit (DPU) for the period was 0.49 Singapore cent, in line with the forecast, DLHT said. The first distribution, which will include the period from the listing date through 30 June, will be paid on or before 30 September, the trust said.

The portfolio of 14 Japan-based logistics properties was revalued to 81.07 billion Japanese yen, or around S$949.7 million, as of end-December, compared with an acquisition price of 71.07 billion yen on the listing date, DHLT said. 

Takeshi Fujita, CEO of DHLT’s manager, said that while portfolio occupancy remained high at 96.3 percent, the manager would work to lease out the vacant space, with negotiations with potential tenants underway.

Outlook

In its outlook, Daiwa House Logistics Trust noted that Japan has upgraded its economic growth forecast for fiscal 2022, but added that Covid-19 was still creating uncertainties. 

The trust said, however, that in a sign of the portfolio’s resilience, tenants made no requests for rental relief or abatement during the 26 November to 31 December period.

“While supply in logistics space in Japan continued to grow in recent years, supply-demand remained tight resulting in generally low vacancy rate. Looking ahead, large supply of logistics space is expected over the next two years in certain markets, particularly in Greater Tokyo, which may result in increasing vacancy and moderation of rental rates growth in these markets. However, demand is expected to remain robust in general with the continual expansion of Japan’s e-commerce market a major contributing factor.” 

Read more about Daiwa House Logistics Trust’s results