- CapitaLand Ascendas REIT’s 1Q25 business update saw broad based occupancy decline but positive reversions continued.
- Guidance is unchanged for mid-single digit positive reversion for the year.
Mixed Operating Trends
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- Lower occupancy in Singapore resulted from vacancy in a data centre. The US and Australia saw declines in logistics and business parks.
- New demand in Singapore and overseas came from logistics. Average portfolio reversion was +11% for the quarter, with industrial and distribution centres leading in Singapore and logistics for overseas properties.
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Prudent capital and asset management
- Gearing rose to 38.9% (37.7%) from ongoing redevelopments and acquisitions. Debt cost was lower at 3.6% (4Q 3.7%) and coverage was stable at 3.6x.
- Geneo (30% stake), a life-science focused business park, achieved completion in 1Q with 95% occupancy (76% committed and 19% under advanced negotiations).
- CapitaLand Ascendas REIT also completed the proposed acquisition of DHL Logistics Centre in Indianapolis, US.
- Selective divestment opportunities will be considered in Singapore to optimize the portfolio. Focus is on expanding CapitaLand Ascendas REIT’s logistics presence in the US.
- No announcement has been made for redevelopment of its UK data centre.
Maintain BUY
- Read more at SGinvestors.io.
