19 Tai Seng Avenue (ESR-REIT)Artist's Impression of 19 Tai Seng Avenue (ESR-REIT)

Data from ESR-REIT’s latest disclosure can be found in the Singapore REITs table.

ESR-REIT has reported DPU of 0.723 cents for its 1Q 2022, a 0.3% increase year-on-year.

Accordingly, the amount available for distribution for 1Q 2022 increased 2.1% year-on-year to SGD29.3 million.

However, ESR-REIT’s gross revenue and net property income (NPI) slid by 1.2% and 10.2% to SGD59.6 million and SGD39.5 million respectively.

The REIT has attributed the NPI decrease to higher property expenses as a result of the surges in utilities costs amid an increase in global energy prices and higher electricity demand.

“While we are encouraged by the steady recovery from the pandemic, the global energy crisis is raising power costs for utilities and coupled with the rising inflation, have increased our utilities and maintenance expenses”, said Adrian Chui, CEO of the REIT’s manager.

“Nonetheless, the industrial market is seeing a healthy demand from the logistics and general industrial sectors due to an acute shortage of quality space, and this was reflected in the positive rental reversions recorded for this quarter, continuing the positive trend from last quarter”, he added.

Chui expects utilities costs to remain high in the near term, impacting net property income.

The REIT has taken steps to manage these surges in utilities costs and inflationary pressures, such as sourcing electricity tariff rates with SP Services, which are lower than current pool rates, or tenants who consume large amounts of electricity.

ESR-REIT was last done on the Singapore Exchange at SGD0.41, which presently implies a distribution yield of 7.05% according to data on the Singapore REITs table.

Related: ESR-REIT increases new economy exposure with Senoko Loop revamp

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.