PARKWAY Life Real Estate Investment Trust (Reit) posted a 3.5 per cent rise in distribution per unit (DPU) to S$0.0754 for its first half ended Jun 30, from S$0.0729 in H1 2023.
The manager of the healthcare-focused Reit on Friday (Jul 26) announced that revenue for the period fell 2.7 per cent to S$72.4 million, from S$74.4 million a year prior. This was due largely to the depreciation of the Japanese yen, and was partially offset by contributions from two nursing homes acquired in October 2023.
Net property income fell as well. It was down 2.5 per cent to S$68.4 million in H1 2024, from S$70.1 million in H1 2023.
Distributable income rose 3.5 per cent to S$45.6 million in H1 2024, from S$44.1 million in the year-ago period. This was due to contributions from properties with step-up lease arrangements.
Non-property expenses fell 11.8 per cent to S$9.4 million in H1 2024, from S$10.6 million in H1 2023. This was largely due to realised foreign exchange gains from the settlement of Japanese yen forward contracts.
Parkway Life Reit has put in place Japanese yen forward income hedges until the first quarter of 2029, with about 90 per cent of interest rate exposure hedged. The manager said that the Reit will continue to follow its financial management framework to mitigate refinancing risks, as well as manage exposure to interest rate and currency risks.
The weighted average lease expiry for Parkway Life Reit’s portfolio stands at 16.1 years as at Jun 30.
Yong Yean Chau, chief executive officer of the manager, noted that the healthcare industry is becoming “critically essential in a rapidly ageing population with greater demand for better-quality healthcare and aged care service”. Amid that environment, Parkway Life Reit will continue to focus on “driving resilient returns”, he said.
Units of Parkway Life Reit closed Friday down 0.3 per cent or S$0.01 to S$3.58.
