Saizen REIT has secured a loan worth SGD8.9 million for its working capital.

Singapore-listed Japan-focused residential real estate investment trust Saizen Real Estate Investment Trust (SGX:T8JU) has declared a distribution per unit (DPU) of 3.10 Singapore cents for the six-month financial period ended 31 December 2014.
The distribution represents a decrease of 4.6% as compared to the 3.25 cents distributed for the six-month financial period ended 31 December 2013.

In an official statement regarding the results, Saizen REIT has attributed the slip mainly due to lower net property income and the depreciation of the JPY against the SGD.

Saizen REIT also highlighted that the period’s distributable income includes an amount from capital cash resources which will be used to offset loan principal repayment. “For YTD Dec 2014, the use of capital cash resources to offset loan principal repayment contributed to 1.39 cents out of the DPU of 3.10 cents”, said the REIT

“Going forward, the ability to offset such loan principal repayment is subject to the availability of cash resources which will depend on cash raised on new loans or disposal proceeds within the coming year”, the REIT added.

The average occupancy rate of Saizen REIT’s properties was reported at 90.0% for 2Q FY2015 but overall rental reversion was lower by about 0.3%.

The REIT reiterated that the weakening of the JPY against the SGD in 2Q FY2015 had weighed on Saizen REIT’s net asset value and income in SGD-terms. Saizen REIT said that it has hedged the distribution payments for the six-month financial period ending 30 June 2015 at JPY85.6 to SGD1.00.

Units of Saizen REIT are currently listed on the Singapore Exchange at SGD0.87.

Saizen REIT property Clair Court.
Saizen REIT property Clair Court.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.