AA Reit DPU drops 10% to 2.5 cents

Expired leases and lower rentals caused the fall.

AIMS AMP Capital Industrial (AA Reit) has suffered headaches for Q2 after it reported a 10% drop in distribution per unit (DPU) to 2.5 cents.

According to AA Reit's financial statement, gross revenue fell by 0.3% from $30.6m to $30.5m.

The company cited the expiry of master leases at 3 Tuas Avenue 2 and lower rental and recoveries from 20 Gul Way as one additional phase of the property reverted to multi-tenancy leases on 8 May 2017.

This was offset by the full quarter rental contribution from 30 Tuas West Road.

Distributable income also fell 9.9% to $16m.

"This was mainly due to the 4Q FY2017 distribution which included retained distributions from the previous three quarters of FY2017 and partial retention of the current quarter’s distribution to fund the working capital and/or capital expenditure requirements of the Trust," AA Reit chief executive officer Koh Wee Lih said.

Net property income (NPI), however, rose to $20.1m this year, $1m higher than the previous year's $19.9m, thanks to lower property operating expenses.