AIMS AMP Capital Industrial REIT (AA REIT) 1Q218

Occupancy History

Q118	FY17	FY16	FY15	FY14	FY13
91.00%	94.60%	93.40%	95.80%	97%	96.10%

Lease

22.9% of lease base on gross rental income will expired

• 13.5% (14,700 nla) lease will not be renewed which in Q417, the manager has mentioned Cimelia Resource will not renewing its master lease which mean a loss of $2.56m gross rental income and it is account 2% of gross rental income. This one of the cause the occupancy rate to drop to 91%
• Successfully extended the master lease of CIT Cosmeceutical Pte Ltd (6,255.0 sqm of net lettable area), a top 10 tenant, ahead of its lease expiry in FY2018.
• Q118 Lease reversion is -4.3%

Dividend

Q1	FY17	FY16	FY15	FY14	FY13
0.025	0.1105	0.1135	0.1107	0.1053	0.1072
-9.50%	-2.64%	2.53%	5.13%	-1.77%

For Q118, the distribution rate is 94.4%

Debt

Debt for FY18 $69m and $120m has been secured to be extended to 2021 and 2022 hence no debt will need to be refinance for FY18.

Debt for FY19 of $98.4m and $117m will need to be refinance by Nov 18 and Feb 18

In Summary

1. Renewal  lease reversion is -4.3% and for those new rental and there is no information what is the rate of new rental secured to replace expired rental if it is below the expired rent rate.
2. The industrial leasing market remains challenging as supply continues to outpace demand in a soft market environment. This is likely to exert further downward pressure on rentals and occupancy
3. 8 Tuas Avenue 20 has secured the 1st tenant with 10 years lease, with the close proximity the prospect to secure the tenant should be better.
4. 51 Marsiling Road will be ready in 2Q18 and provide around $3.5m rental, this should cushion the negative rental reversion and lost of Cimelia master lease.

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