Ascendas REIT's property income jumped 6% to $150.9m

Thanks to acquisition of The Galen.

According to DBS, A-REIT’s 1Q14 results were in line, with gross revenues and net property income growing 6% and 7% to S$150.9m and S$108.0m, respectively. 

This was largely due to the acquisition of The Galen, supported by an organic uplift in rents. Rental reversions remained positive at c9.6% compared to previously contracted rents while occupancy rates dipped slightly to 93.6% due to conversion of certain singletenanted properties into multi- tenanted properties.

Here's more from DBS:

Weighted allin cost declined slightly to 3.09% (vs 3.32%) but is expected to remain stable going forward. Distributable income came in 11.3% higher at S$85.2m, translating to a DPU of 3.55 Scts for the quarter (+0.6% due to an enlarged share base). 

The recent completion of Unilever Four Aces Singapore (a built-tosuit facility) and the acquisition of A-REIT City @ Jinqiao are expected to start kicking in from 2Q14. We note that there is a S$13.5m rental guarantee on the latter, which will mitigate any earnings downside.

A-REIT has commenced leasing of the space, which is currently 3% leased with a further 20% of the space under negotiation.