REIT-TIREMENT - REITs Investing & Personal Finance

REITs investing & personal finance


Friday, August 19, 2022

Ascendas REIT Review @ 19 August 2022

Basic Profile & Key Statistics

  • Main Sector(s): Office, Industrial & Logistics
  • Country(s) with Assets: Singapore, United States, Australia, England, Netherlands, France, Switzerland
  • No. of Properties (exclude development/associate/fund): 228

Key Indicators


Performance Highlight

Gross revenue, NPI, DI and DPU increased yoy mainly due to contributions from 11 data centres in Europe, the remaining 75% interest in Galaxis, 11 logistics properties in U.S. and 2 logistics properties in Australia which were acquired in between 2021 March to 2022 Jun.

Rental Reversion
The rental reversion is at 13.2% for 2Q 2022 and 9.4% for 1H 2022.

Completed Acquisition/Developments/AEI
In 1H 2022, AREIT completed the acquisition of 9 logistics properties. Redevelopment of UBIX is completed in Jan and AEI for Changi Logistics Centre is completed in Apr. On 4 Aug, AREIT has announced for acquisition of Philips APAC Center in Singapore which is targeted to complete acquisition by 2H 2022.

On-Going Development & AEI
Development for MQX4 has been delayed from 4Q 2022 to 1Q 2023. As for redevelopments, 1 Science Park Drive and iQuest are expected to complete by 2Q 2025 and 4Q 2024 respectively. There AEIs for 17 Changi Business Park Central 1 and The Alpha are expected to complete by 4Q 2022 and 4Q 2023 respectively.

Sensitivity to Interest Rate
For every 1% increase in interest rate, DPU would be impacted by 2%.

 Related Parties Shareholding

  • REIT sponsor's shareholding: Below median for more than 20%
  • REIT manager's shareholding: Below median for more than 20%
  • Directors of REIT manager's shareholding: Below median for more than 20%

Lease Profile

  • Occupancy: ± 10% from median
  • WALE: ± 10% from median
  • Highest lease expiry within 5 years: Below median for more than 20%; Falls in 2023
  • Weighted average land lease expiry: Below median for more than 10%

Debt Profile

  • Gearing ratio: ± 10% from median
  • Gearing ratio including perps: ± 10% from median
  • Cost of debt: Below median for more than 10%
  • Fixed rate debt %: ± 10% from median
  • Unsecured debt %: ± 10% from median
  • WADM: Above median for more than 20%
  • Highest debt maturity within 5 years: Below median for more than 20%; Falls in 2026
  • Interest coverage ratio: Above median for more than 20%

Diversification Profile

  • Top geographical contribution: Above median for more than 10%
  • Top property contribution: Below median for more than 20%
  • Top 5 properties' contribution: Below median for more than 20%
  • Top tenant contribution: Below median for more than 20% 
  • Top 10 tenants' contribution: Below median for more than 20%

Key Financial Metrics

  • Property yield: Above median for more than 10%
  • Management fees over distribution: ± 10% from median; $7.19 distribution for every dollar paid 
  • Distribution on capital: Above median for more than 10%
  • Distribution margin: ± 10% from median

Trends


  • Uptrend: NAV per Unit
  • Flat: Occupancy
  • Slight Downtrend: DPU, Property Yield, Distribution Margin
  • Downtrend: Interest Coverage Ratio, Distribution on Capital

Relative Valuation

  • P/NAV - Average for 1y & 5y; Below average for 3y
  • Dividend Yield - Average for 1y, 3y & 5y

Author's Opinion

 Favorable Less Favorable
Diversified SectorLow REIT Sponsor's Shareholding
Well Spread Lease ExpiryLow REIT Manager's Shareholding
Low Cost of DebtLow Directors of REIT Manager's Shareholding
Long WADMHigh Top Geographical Contribution
Well Spread Debt MaturityInterest Coverage Ratio Downtrend
High Interest Coverage RatioDistribution on Capital Downtrend
Low Top Property & Top 5 Properties Contributions 
Low Top Tenant & Top 10 Tenants Contributions 
High Property Yield 
High Distribution on Capital 
NAV per Unit Uptrend

The performance has improved as compared to 2H 2021 due to acquisitions completed between Nov 2021 to Jun 2022. With the full contribution for the next 6 months from those newly acquired properties, AREIT performance is expected to be improved.


You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and Detail of Singapore REIT

REIT Analysis - List of previous REIT analysis posts


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REIT Investing Community - Facebook Group where members share and discuss REIT topic


*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage as a result of the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.

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