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AIMS Apac REIT Continue T0 De-risk The CWT Exposure

Key Highlights:

  • Aims Apac REIT (SGX: O5RU)'s 2Q19 DPU remained flat at 2.5 cents

  • The annualised yield and price to book ratio are 7.2% and 1.05 respectively

1. Dividends

Net property income was up 16.6% to $22.5m. This was mainly due to the reclassification of land rent based on the new accounting standards. Actual performance and DPU remain rather flat.

The annualised yield is 7.2%.

2. Portfolio

Portfolio occupancy remains stable at 92.2%. The manager continues to expand its tenant base by 13% to 179. Optus remains as its largest tenant, contributing 12.3% of the gross rental income. Exposure to CWT will progressively expire in FY20 before the remainder runs out in July 2021. The portfolio leverage is currently at the healthy side of 35.4%. The interest cost is at 3.5%, with 75.3% of the loans are on fixed rates.

It is currently trading at a price to book ratio of 1.05.

3. Growth Catalyst

The REIT manager has recently secured a US-based medical device company as a master tenant for the 3 Tuas Ave 2 on a 10-year triple net lease. This will help the REIT to boost its income once the asset redevelopment is completed by mid of next year.

Besides, the AEI at NorthTech Woodlands will be completed in 4Q19.

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