IREIT Global net property income dips 5.1% in H1

Portfolio occupancy, however, improved to 94.4%.

IREIT Global reported that its net property income fell 5.1% year-on-year in the first half of 2026, whilst gross revenue declined 2.3%, as higher finance costs weighed on the trust's earnings.

The impact was sharpest at the distribution level, with income to be distributed to unitholders falling 47.5% year on year and distribution per unit dropping 47.9%.

Finance costs rose mainly due to a higher loan margin following the refinancing of the German Portfolio in October 2025, compounded by new interest rate swaps that took effect from January 2026.

Despite the earnings pressure, portfolio occupancy improved to 94.4% as at 30 June 2026, from 89.4% at the end of 2025, driven by leasing successes in Germany and Spain. In Germany, the manager secured a 10-year lease with a federal tenant at Darmstadt Campus, along with additional leases expected to lift the property's occupancy to 71.9% from 41.3%. In Spain, seven new leases and extensions across all four office properties are expected to raise the Spanish portfolio's occupancy to 92.6% from 80.3%.

The repositioning of Berlin Campus continues to progress, with the first phase comprising hospitality assets around 32% complete as at 30 June 2026. The project is expected to be completed in the third quarter of 2027, with discussions ongoing with potential office tenants for the second phase.

Chief executive of the manager Peter Viens said the operating performance remained resilient, underpinned by leasing momentum across the portfolio.

"Although higher finance costs are weighing on income available for distribution and DPU, we remain focused on active asset management, prudent cost control and disciplined capital management to strengthen IREIT's earnings resilience over time," Viens said.

The manager said it was targeting to finalise the refinancing of the Spanish Portfolio in the second half of 2026, and that finance costs were expected to rise further due to the refinancing exercises and additional borrowings for the Berlin Campus project.