Singapore REITs Earnings For January 2024
Here are the REITS that have reported their earnings or business updates in January 2024.
You can skip to the respective REITs that you are interested in by clicking on the name:
In 2024, I will analyse every single listed REIT counter in Singapore. You can assess my independent analyst report on my telegram channel and stay informed with future REIT analysis and earnings updates.
AIMS APAC REIT
AAPC REIT announced their Q3 2024 results on 31 January of which:
What is positive:
Healthy top & bottom-line growth (~5%)
Portfolio occupancy improved by 0.3% to 98.1% Y.O.Y
Aggregate leverage decreased by 4.2% to 32.2% Y. OY
No refinancing requirements in 2024
What is negative:
DPU decreased by 4.1% at the back of an enlarged unit base
My stance remains unchanged. I would not consider AAPC REIT as there are other better industrial REIT alternatives available.
CapitaLand Ascott Trust
CAT announced their FY 2023 results on 30 January which:
What is positive:
DPU increased by 14% Y.O.Y from stronger operating performances
RevPAU of key markets continued to exceed pre-covid levels
Divested properties at a premium to book value to facilitate capital recycling
What is negative:
Nil
I have no comments at the moment as I’ve not covered CapitaLand Ascott Trust yet.
CapitaLand India Trust
CIT announced their FY 2023 results on 29 January which:
What is positive:
Net Property Income grew by 8% Y.O.Y on Singapore dollar terms
NAV improved by 5% Y.O.Y on Singapore dollar terms
The weighted average cost of debt has maintained since 1H 2023
What is negative:
DPU decreased by 21% as a result of preferential offering impact and FX losses
The cost of borrowing is expected to go up as over 30% of debt is due for refinancing in 2024
I have no comments at the moment as I’ve not covered CapitaLand India Trust yet.
CapitaLand China Trust
CCT announced their FY 2023 results on 29 January which:
What is positive:
Healthy top and bottom-line growth due to better operating conditions
Divestment of CapitaMall Shuangjing in Dec 2023 at an exit yield of 2.8%
Capital management profile improved slightly Q.O.Q
Shopper traffic increased by 45.8% Y.OY and tenant sales grew 41.5% Y.O.Y
What is negative:
DPU decreased by 10.1% as a result of FX losses and higher interest cost
Portfolio valuation decreased by 0.9% Y.O.Y due to weaker sentiment
CDL Hospitality Trust
CDL announced their FY 2023 results on 30 January which:
What is positive:
DPU increased by 1.2% Y.O.Y
Healthy top and bottom-line growth due to better operating conditions
Positive momentum in RevPAR growth across all portfolio markets
Portfolio value grew by 7.8% Y.O.Y
What is negative:
Higher interest costs essentially eroded the top and bottom-line growth
30.1% of debt is due for refinancing in 2024
I have no comments at the moment as I’ve not covered CDL Hospitality Trust yet.
Frasers Logistics & Commercial Trust
FLCT announced their 1st Quarter 2024 results on 30th of January which:
What is positive:
Strong portfolio rental version (>10%)
Capital management ratios remained relatively unchanged
Completed Ellesmere Port which should contribute to FY24 performances
What is negative:
Commercial property's occupancy rates are still low (below 90%)
Around 25% of debt is due for refinancing in 2024
My stance remains unchanged. I think FLCT is a good position to have in my portfolio but not at this price. With the cost of borrowing expected to go up this year due to refinancing requirements, I expect further downward pressure on share price which could offer a potential entry point in the future.
Frasers Centrepoint Trust
FCT announced their 1st Quarter 2024 results on the 23rd of January of which:
What is positive:
Portfolio occupancy has increased by 0.2% since last quarter to 99.9%
Aggregate leverage has decreased by 2.1% since last quarter to 37.2%
Tampines AEI is on track to be completed & already has a 97% lease commitment
FCT is acquiring an additional 24.5% stake in Nex shopping mall
What is negative:
Tenants’ sales have decreased as a result of renovation and asset enhancement works
The average cost of debt increased by 0.2% since last quarter to 4.3%
Overall, nothing much has changed outside of expectations. I expect 2024 performances to be slightly affected negatively due to the loss of rental income from AEI works and the higher cost of borrowing. At the current price levels, FCT trades around 5 to 5.5% dividend yield which, in my opinion, is fairly valued. If the price is right, I’d accumulate more shares.
Keppel DC REIT
KDC announced their Full Year 2024 results on 26 January which:
What is positive:
Portfolio occupancy remained resilient at 98.3%
The cost of borrowing is unlikely to increase further given that there is not a lot of debt due for refinancing in 2024 and 2025
What is negative:
DPU had decreased by 9.3% due to higher borrowing costs and loss allowances for uncollected rental income in Guangdong Data Centers
Uncollected rental arrears and tenant woes over Guangdong Data Centre 1 to 3 might result in a performance drag for the next few years if not resolved promptly
Given the tenant woes over Guangdong Data Centers coupled with disappointed investor sentiment at an overvalued price, I expect further downside pressure on the share price of Keppel DC REIT. Should Keppel DC REIT trade around a 6% dividend yield, I think it may be worth considering despite the tenant headwinds as those too shall pass.
Mapletree Logistics Trust
Mapletree Logistics Trust had announced their Q3 2023/4 results on 24 January of which:
What is positive:
Available DPU increased by 0.7% largely due to divestment gains
Divestments proposed and completed are well above the valuation
What is negative:
Portfolio occupancy had decreased by 1% Q.O.Q
Higher property expenses and FX losses continue to weigh on growth
Performance in China is dragging down overall performance
MLT performance for Q3 23/24 seems to be neutral in my opinion as the growth in the top line is pretty much eroded by higher expenses and an enlarged unitholder base. Overall, the report does not change my existing view on the counter – which is investible but not at this price.
Mapletree Industrial Trust
Mapletree Logistics had announced their Q3 2023/4 results on 25 January of which:
What is positive:
Higher average rental rates across Singapore and North American Portfolio
Weighted average lease expiry improved to 4.4 years from 4.2 years Q.O.Q
Average all-in funding cost decreased by 0.1% Q.O.Q
What is negative:
Occupancy rate dipped by 0.6% Q.O.Q
The aggregate leverage ratio increased to 38.6% in Dec 2023 from 37.9% in Sept 2023
DPU decreased by 0.9% Y.O.Y at the back of higher property expenses and enlarged unit base
MIT's performance for Q3 23/24 seems to be neutral in my opinion as the growth in the top line is pretty much eroded by higher expenses and an enlarged unitholder base. Overall, the report does not change my existing view on the counter – which is investible but not at this price.
Mapletree Pan Asia Commercial Trust
MPACT had announced their Q3 2023/4 results on 25 January of which:
What is positive:
Higher gross revenue (+21.2%) due to full-year contribution from acquired properties
Occupancy improved by 1.2% Y.O.Y to 96.7%
Capital management ratios remained relatively unchanged Y.O.Y
What is negative:
DPU decreased by 10.1% Y.O.Y at the back of higher interest expense, enlarged unit base and absence of one-off gains
I have no comments at the moment as I’ve not covered MPACT yet.
OUE Commercial REIT
OUE REIT announced their FY 2023 results on 29 January which:
What is positive:
Relatively unchanged DPU (+1.8% Y.O.Y)
Robust performance was driven by full room inventory of Hilton Singapore Orchard
Aggregate leverage decreased by 1.2% Y. OY to 38.2%
No debt refinancing required in 2024
What is negative:
Weighted average cost of debt increased by 0.1% Y.O.Y
I have no comments at the moment as I’ve not covered OUE Commercial yet.
Suntec REIT
Suntec REIT announced their Financial Year 2023 results on 24 January which:
What is positive:
Resilient performance from local properties via higher occupancy and rental reversion
What is negative:
DPU has decreased by 19.7% year on year
The impact of high interest rates is expected to continue over the next few years
More headwinds are expected for foreign properties which could further impact occupancy and property valuation
Unfortunately, due to poor capital management, the performance of Suntec REIT will probably continue to remain depressed in the next few years as a result of a higher interest rate environment and the eventual absence of one-off items such as income support and capital distribution from divestment which had been propping up the DPU in the last few years.
The current price that Suntec is trading at is definitely outside of my comfort zone as I feel that they are overvalued based on their distribution from operations alone. That being said, at the right price, I still think Suntec REIT is worth considering given the quality of its local properties.
Sabana REIT
Sabana Industrial REIT announced their Financial Year 2023 results on 23 January of which:
What is positive:
Spectacular growth in gross revenue (+17.9%) due to high rental reversions
Higher portfolio valuation, supported by asset enhancement and rejuvenation efforts
What is negative:
DPU has decreased by 9.5% year on year due to higher capital retention and lower distribution percentage (90% in 2023 vs 100% in 2022) in anticipation of the additional cost that is to be incurred for their internalization process
The bottom line remained unchanged largely due to the one-off cost incurred by the ongoing internalization process
Despite the strong top-line performances, my concern for Sabana REIT is still the uncertainty that looms around the internalization process of which my stance remains unchanged for this counter.
Starhill Global REIT
Sabana Industrial REIT announced their 1H 2023/4 results on 29 January of which:
What is positive:
Portfolio occupancy improved by 1% over the last 6 months
Renewed the master lease at Ngee Ann property – extending WALE to 7.9 years
What is negative:
DPU has decreased by 2.2% Y.O.Y due to higher financing costs and one-off commission fee
No changes in view on the counter. I’d probably still avoid this counter as there are better alternative REITs that provide the same underlying exposure to both commercial and offices.
Daniel is a Licensed Independent Financial Consultant with MAS and a Certified Financial Planner (CFP®).
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Disclaimer:
This article is meant to be the opinion of the author
This article is for information purposes only
This article should not be seen as financial advice
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