AIMS AMP Capital Industrial REIT's 30 & 32 Tuas West Road. (Photo: AIMS AMP Capital Industrial REIT)

Amid doldrums in the demand for industrial space in Singapore, AIMS AMP Capital Industrial REIT announced on 27 April that it has recorded a DPU of 2.78 Singapore cents for its 4Q 2017, a decrease of 5.8% from the 2.95 cents achieved in the corresponding period of 2016.

As such, the REIT’s total DPU for FY2017 came in at 11.05 cents, a fall of 2.6% from the 11.35 cents reported for FY2016.

For 4Q 2017, gross revenue and net property income increased by 0.8% and 0.9% to SGD30.6 million (USD 22 million) and SGD19.9 million respectively quarter-on-quarter, but this is primarily due to maiden income contribution from newly acquired 30 Tuas West Road.

“While there is continued headwinds across the industry with rents under pressure from the oversupply situation in the Singapore industrial market, data from the first quarter of 2017 is reflecting early signs of recovery and providing some optimism”, said Koh Wee Lih, CEO of the REIT’s manager.

The REIT’s portfolio occupancy was at 94.6%, which is currently above the industry average of 89.5%, while weighted average lease expiry (WALE) has also improved slightly to 2.52 years from 2.49 years in the previous quarter.

Aggregate leverage has been maintained at 36.1% but all-in financing costs have been reduced to 3.7% per annum, down from 4.2% a year ago, and 84.4% of its financing costs has been fixed.

“Given the uncertain macroeconomic and geopolitical outlook and the industrial oversupply situation in Singapore, rentals will continue to be under pressure”, the REIT warned.

“[AIMS AMP Capital Industrial REIT] is focused on active asset management, and unlocking organic value within the portfolio through asset enhancement initiatives and redevelopments”, the REIT added in its statement.

Units of AIMS AMP Capital Industrial REIT are currently listed on the Singapore Exchange at SGD1.39.

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.