ARA Asset Management’s earnings jump 10% to $19.8m in Q1

Thanks to growth in all three of its segments.

ARA Asset Management has closed the first quarter of 2016 to the tune of $18.98m in net profits. This is after taking into account exceptional adjustments, thereby reflecting a 10% YoY climb.

According to the company’s news release, the growth is thanks to recurrent management fees growing 14% to $34.3m during the quarter. It was underpinned by increased REIT management fees, portfolio management and service fees as well as real estate management fees.

REIT management fees inched up 5% YoY to $22m for Q1, due mainly to better asset performance from existing properties following the asset enhancement initiatives undertaken which led to higher property valuations.

Portfolio management and service fees skyrocketed 48% YoY to $6.5m, thanks to increased management fees from ARA China Investment Partners, after the acquisition of two China commercial properties in September and december last year. This is on top of the ARA Harmony Fund III and ARA Harmony Fund V launches.

Real estate management fees grew 19% YoY to $5.8m in Q1, thanks mainly to higher property management fees received.

Meanwhile, acquisition, divestment and performance fees were lower at $1.8m. Share of profit of associates and joint venture declined as well, slipping to $1.3m in the quarter.

“Notwithstanding sector headwinds, the performance of the office and retail portfolios under management is expected to be stable for the year and our long-term growth initiatives will add value to stakeholders,” says ARA Group CEO John Lim.