Ascendas Reit Q3 DPU up 0.7%

It will develop and manage Grab's S$181.2m HQ on a long lease which will provide a stable income stream


ASCENDAS Reit on Wednesday posted a 0.7 per cent increase in distribution per unit (DPU) to 3.998 Singapore cents for the third quarter ended Dec 31, 2018, from 3.970 Singapore cents a year ago. Ascendas noted that the DPU takes into account an enlarged number of units in issue.

Net property income rose 6.6 per cent to S$168 million mainly due to lower property tax expenses.

Gross revenue increased 4.2 per cent to S$226.4 million. This was due to newly acquired properties in the UK and Australia, and a redeveloped property in Singapore. However, these contributions were partially offset by non-renewals in certain properties in Singapore.

Total amount available for distribution was up 7 per cent to S$124.3 million.

Ascendas Reit's manager also announced on Wednesday that Ascendas Reit will be developing and managing Grab's new S$181.2 million headquarters located within the one-north business park.

The building will have an estimated gross floor area of 42,310 square metres and is expected to complete in the fourth quarter of 2020.

It will house all of Grab's Singapore employees, consolidating its current offices and creating the first dedicated physical facility for the company. The company, which crossed 3 billion rides on Jan 20, will also base its largest research and development (R&D) centre there.

William Tay, chief executive and executive director of the manager, said: "The long lease commitment of 11 years by Grab will provide Ascendas Reit with a stable income stream. This build-to-suit development takes our business and science park investments to S$3.8 billion and accounts for 34 per cent of our total portfolio value of S$11.3 billion."

The new headquarters will feature the use of recycled building materials and an energy-efficient, low-emissive glass facade to reduce solar heat gain. The development is expected to achieve Green Mark GoldPlus certification from the Building and Construction Authority.

Ascendas Reit's counter closed at S$2.72, down S$0.04, before results were out.