ART – Lim and Tan

• Distribution per unit (DPU) for Q4 ’10 of 2.16 cents is 17% higher than forecast at the time of the acquisition (from parent CapitaLand) of 28 properties in Europe.

• On an annualized basis, that works out to 7.8 cents, which is in line with 7.74 cents management has expressed confidence in achieving for ye Dec ’20.

• At $1.22, the yield is still an attractive 6.3%, especially given the brightening prospects for the global economy / hospitality sector.

• Indeed, management is particularly bullish on home market, as well as London, as she gets ready for the 2012 Olympics. (Note London was the key contributor to beating internal targets in Q4, with Revenue 15% better, and Gross Profit 31% above.)

• We maintain BUY.