FirstREIT – BT

First Reit’s amount distributable for Q3 rises to $12.08m

FIRST Real Estate Investment Trust (First Reit) saw the amount distributable for the third quarter ended Sept 30 rise to $12.08 million, up from $5.35 million in the previous corresponding quarter.

This was helped by other gain from the distribution of a portion of the total gain on divestment of the Adam Road property which was sold in Q1 this year to Fortis Global Healthcare. The distribution per unit (DPU), payable Nov 29, is 1.92 cents, compared to 1.94 cents in 3Q10.

Meanwhile, gross revenue rose 79.2 per cent to $13.67 million while net property income also rose 79.2 per cent to $13.47 million. Earnings per unit were 1.23 cents for 3QFY11, compared to 1.25 cents in 3QFY10.

Results were lifted partly by maiden contributions from its three new properties: Mochtar Riady Comprehensive Cancer Centre and Siloam Hospitals Lippo Cikarang in Indonesia, and South Korea’s Sarang Hospital.

The gain on divestment from the Adam Road property is about $8.7 million, of which a portion (0.34 cent per unit) will be distributed this quarter as a special non-recurring distribution. The balance will be distributed to unitholders at Bowsprit Capital Corporation’s (First Reit’s manager) discretion in the future, it said in a press release.

In an update on the new five-storey extension block at The Lentor Residence, First Reit expects this to be completed by the second half of 2012.

‘With a visible pipeline from our sponsor PT Lippo Karawaci Tbk, we believe we will be able to strengthen our property portfolio in Indonesia by tapping the sustained demand for quality healthcare services as well as leveraging our sponsor’s long-term expansion plans to develop over 25 hospitals over the next five years,’ said Bowsprit CEO Ronnie Tan. ‘We have been engaging in preliminary discussions with our sponsor to acquire some of its upcoming properties to which we have a first right of refusal.’

Meanwhile, First Reit expects the demand for nursing homes and community hospitals to increase in Singapore as the government lobbies for better tertiary care. Given First Reit’s debt-to-property valuation ratio of 16.4 per cent, Bowsprit said it will continue to look for valuable, yield-accretive healthcare-related assets in the region.

First Reit shares closed at 79.5 cents yesterday, up half a cent.