Ireit Global’s H2 DPU stays at 0.94 euro cent

IREIT Global posted a distribution per unit (DPU) of 0.94 euro cent for the second half of financial year 2024 ended December, unchanged from the year-ago period.

The DPU will be paid out on Mar 27, announced Ireit Global Group, the Europe-focused real estate investment trust’s (Reit) manager, on Wednesday (Feb 26).

Income to be distributed dipped 0.9 per cent to 12.7 million euros (S$17.8 million).

Revenue increased 6.6 per cent to 38.9 million euros, while net property income declined 5 per cent to 26.5 million euros.

The higher revenue was primarily due to the acquisition of the B&M portfolio in France in September 2023, recognition of dilapidation cost payable by the main tenant at Berlin Campus, higher rental income from Darmstadt Campus and higher rental rates at Berlin Campus with effect from July 2024.

For FY2024, DPU was 1.9 euro cent, 1.6 per cent higher than the year-ago period.

Income to be distributed rose 1.5 per cent to 25.6 million euros, in the absence of rent-free periods that were granted to tenants in FY2023. Higher interest income, lower administrative costs and other trust expenses also contributed to the increase.

Revenue was up 16.3 per cent to 75.6 million euros, and net property income rose 7.2 per cent to 53.5 million euros.

Aggregate leverage ratio was 37.6 per cent as at end-December, slightly lower than 37.9 per cent as at Dec 31, 2023.

Weighted average lease expiry stood at 5.9 years as at Dec 31, compared to 5.8 years the preceding quarter.

Interest coverage ratio was 7.6 times for FY2024, compared to FY2023’s seven times.

The manager is in discussions with banks to refinance existing borrowings for the Reit’s German and Spanish portfolios by the first half of 2025. Once completed, Ireit Global will have no debt maturing until July 2027, although financing costs are expected to increase in tandem amid the high interest-rate environment.

The trust also plans to renovate Berlin Campus – converting it from a single-let property into a mixed-use, multi-let asset – to enhance the property’s long-term value.

The total projected capital expenditure is estimated to be 165 million to 180 million euros.

During the repositioning period, the absence of income from Berlin Campus is expected to have a significant impact on Ireit Global’s distributions to unitholders.

The manager intends to seek unitholders’ approval for the proposed repositioning project at an extraordinary general meeting to be convened.

Ireit Global closed 1.9 per cent or S$0.005 lower at S$0.265 on Wednesday, before the financial results were published.