THE manager of Daiwa House Logistics Trust (DHLT) has recorded distributable income of S$25.5 million for the first nine months of FY2024, down 5.5 per cent from S$27 million the year before.
The decline was largely due to currency fluctuations, as the average exchange rate for the Japanese yen against the Singapore dollar was about 8 per cent weaker in 9M FY2024, compared to the year before.
The real estate investment trust’s (Reit) manager said the impact of foreign exchange was partially alleviated by contributions from the July 2024 acquisition of D Project Tan Duc 2, a cold storage warehouse in Vietnam.
“Underlying performance of the portfolio continued to be healthy,” the manager said in a business update for the third quarter ended September on Friday (Nov 8).
Rental income for the nine-month period edged up 1.8 per cent to 4.18 billion yen (S$36 million), while net property income climbed 2.8 per cent to 3.62 billion yen.
As at end-September, DHLT’s portfolio occupancy stood at 97.5 per cent, up from 96.6 per cent as at end-June.
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The Reit manager said it has concluded its lease renewal activities for FY2024, with a weighted average rent uplift of about 5 per cent for the year.
The weighted average lease expiry for the overall portfolio stood at 6.6 years as at Sep 30.
DHLT’s aggregate leverage stood at 39.2 per cent as at Sep 30, with weighted average debt tenure of 1.7 years and weighted average borrowing cost at 1.13 per cent.
The Reit has an interest coverage ratio of 11.2 times.
As at end-September, net asset value per unit attributable to unitholders fell to S$0.69, from S$0.74 as at end-December 2023. This was mainly due to the weaker yen, and lower cash following the distribution for H1 FY2024.
In its outlook, the Reit manager noted substantial new supply in the Japan logistics market in 2024, which poses “near-term challenges”.
From a longer-term perspective, the manager said market fundamentals are expected to remain healthy, supported by growing demand from various industries such as e-commerce and manufacturing, it added.
Jun Yamamura, chief executive of the Reit manager, described the acquisition of D Project Tan Duc 2 – the Reit’s maiden foray outside Japan – as “an important milestone for DHLT”.
Units of DHLT closed 4.2 per cent or S$0.025 lower at S$0.565 on Thursday.
