Ascendas REIT reports healthy Q1 performance

Its portfolio recorded a positive rental reversion of 8%.

Ascendas Real Estate Investment Trust (Ascendas REIT) reported a ‘healthy operational performance’ for Q1, as it braces for more challenges and uncertainties due to the current operating environment, the REIT announced in an SGX filing.

Overall portfolio occupancy rate improved 91.7% in Q1 from 90.9% as of end 30 December 2019, which was mainly attributed to the higher occupancy rate of 88.6% in its Singapore portfolio on the back of higher demand for logistics space.

The REIT’s overseas portfolio also retailed ‘relatively stable’ occupancies in Australia (97.3%), US (92.9%) and the UK (97.5%).

Overall, Ascendas REIT’s portfolio achieved a positive rental reversion of 8% for renewed leases in multi-tenant buildings for the quarter.

From a financial standpoint, Ascendas maintained a healthy aggregate leverage at 36.2%, whilst the weighted average all-in cost in borrowing was maintained at 2.9%. Its debt maturity profile is reportedly with a weighted average tenure of debt outstanding at 3.8 years.

Liquidity remains robust with an operating cash flow underpinned by a $12.8b portfolio comprising 45% business park/suburban office, 30% industrial properties and 25% logistics properties, the REIT stated.

Ascendas REIT also shared that it has reserved $490m in case the pandemic’s ill-effects are prolonged, comprising $290m in cash and $200m in committed facilities.

The REIT added that none of its properties were shut down due to COVID-19, and tenants in the essential industries continue to operate normally. Further, the REIT says that it will be fully passing the reduction in the property tax by way of a property tax rebate to its qualifying tenants, according to William Tay, CEO and executive director of Ascendas Funds Management.

“With this property tax rebate and additional rental assistance, its retail and F&B tenants within individual buildings and amenity centres will have their rents waived for two months, from April to May 2020,” added Tay.