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First REIT

First Reit - brighter future for long term holders

First REIT reports lower DPU for the FY2024 of 2.36 cents due to depreciation of yen and Indonesian rupiah

First REIT has reported a lower distribution per unit (DPU) for the FY2024 ended Dec 31, 2024 of 2.36 cents, a 4.8% y-o-y decrease.

The 4QFY2024 DPU came in at 0.58 cents, consistent with the previous quarter, but 3.3% lower compared to 1QFY2024 and 2QFY2024&rsquo s DPU of 0.60 cents.

First REIT says that the decline was largely due to the depreciation of the Japanese yen and Indonesian rupiah against the Singapore dollar, coupled with the enlarged unit base, an 0.8% increase from the year prior, resulting from the issuance of units for payment of management fee to the manager of the REIT.

The REIT&rsquo s rental & other income dropped 5.9% y-o-y for the FY2024 to $102.2 million, and net property and other income fell 6.5% y-o-y to $98.5 million.

Distributable amount declined by 4.1% y-o-y to $49.3 million in FY202.

Likewise, the REIT says that the decline in financial performance comes from the depreciation of the Japanese yen and Indonesian rupiah against the Singapore dollar. The currency impact was partly offset by higher rental income in local currency terms from Indonesia and Singapore properties.

The REIT&rsquo s total debt as at Dec 31, 2024 stood at $459.6 million, and its gearing ratio at 39.6%. Its weighted average term to maturity is 2.5 years, and interest cover ratio is 3.8 times.

The REIT&rsquo s weighted average lease expiry (WALE) is 10.6 years from 11 tenants.

Victor Tan, executive director and CEO of the manager says that the rental and other income for Indonesia and Singapore properties increased by 4.7% and 2.0% respectively in local currency terms while rental and other income for their Japan properties remained stable.

&ldquo First REIT&rsquo s healthcare and healthcare-related portfolio continued to demonstrate healthy underlying performance and operational strengths in FY2024. Our sustainable lease structures and 100% committed occupancy rates were the Trust&rsquo s key drivers during this year of economic uncertainties,&rdquo says Tan.

I'd rather they hedge their currency risk as they did in the past before 2021. But if they sell their Indonesian assets at an above valuation price, that may be a way to recoup some capital. 30 cents a share may be fair value for this reit.

Trainner ( Date: 21-Jan-2025 18:30) Posted:

Maybe selling the Indonesian asset is good to decouple the currency risk.......

MrBear12 ( Date: 21-Jan-2025 13:38) Posted:

Yes, I agree totally with what you say. If bought at IPO, we would have made several times our capital based on distributions alone. However, since the issue of new shares in 2021, many who bought before this will need several more years of income from this REIT before breaking even.

I'd say, just keep and see how this unfolds. The major weakness this reit has is its income is denominated in rupiah which depreciates against SGD.

Otherwise I'd think its investments in healthcare and nursing homes is pretty stable

Maybe selling the Indonesian asset is good to decouple the currency risk.......

MrBear12 ( Date: 21-Jan-2025 13:38) Posted:

Yes, I agree totally with what you say. If bought at IPO, we would have made several times our capital based on distributions alone. However, since the issue of new shares in 2021, many who bought before this will need several more years of income from this REIT before breaking even.

I'd say, just keep and see how this unfolds. The major weakness this reit has is its income is denominated in rupiah which depreciates against SGD.

Otherwise I'd think its investments in healthcare and nursing homes is pretty stable.

Trainner ( Date: 21-Jan-2025 11:53) Posted:

I though has to go back to the IPO price...... at least...... to get back the capital....... many investors bought above IPO prices will suffer loss......

Yes, I agree totally with what you say. If bought at IPO, we would have made several times our capital based on distributions alone. However, since the issue of new shares in 2021, many who bought before this will need several more years of income from this REIT before breaking even.

I'd say, just keep and see how this unfolds. The major weakness this reit has is its income is denominated in rupiah which depreciates against SGD.

Otherwise I'd think its investments in healthcare and nursing homes is pretty stable.

Trainner ( Date: 21-Jan-2025 11:53) Posted:

I though has to go back to the IPO price...... at least...... to get back the capital....... many investors bought above IPO prices will suffer loss......

MrBear12 ( Date: 21-Jan-2025 09:28) Posted:

30 cents by end of the year is reasonably achieveable.

I though has to go back to the IPO price...... at least...... to get back the capital....... many investors bought above IPO prices will suffer loss......

MrBear12 ( Date: 21-Jan-2025 09:28) Posted:

30 cents by end of the year is reasonably achieveable.

Trainner ( Date: 20-Jan-2025 18:03) Posted:

The IPO price was ~$0.50, the highest price was ~$1.30, the lowest was ~$0.23....... what price you hope to achieve?

30 cents by end of the year is reasonably achieveable.

Trainner ( Date: 20-Jan-2025 18:03) Posted:

The IPO price was ~$0.50, the highest price was ~$1.30, the lowest was ~$0.23....... what price you hope to achieve?

Trainner ( Date: 20-Jan-2025 17:52) Posted:

What is your capital?

The IPO price was ~$0.50, the highest price was ~$1.30, the lowest was ~$0.23....... what price you hope to achieve?

Trainner ( Date: 20-Jan-2025 17:52) Posted:

What is your capital?

MrBear12 ( Date: 20-Jan-2025 16:44) Posted:

I think can recoup our capital and balik kampong

What is your capital?

MrBear12 ( Date: 20-Jan-2025 16:44) Posted:

I think can recoup our capital and balik kampong.

HB8289 ( Date: 20-Jan-2025 09:49) Posted:

NICE MOVE

I think can recoup our capital and balik kampong.

HB8289 ( Date: 20-Jan-2025 09:49) Posted:

NICE MOVE

At current price, it is a risk worth to take.
Also, if First REIT is able to negotiate for a good price with Siloam and issue a special div of say 20cts, the risk will go down further. Or, if use the proceed to acquire higher yield properties to increase the dividend, it is also beneficial to the share holders. There are a lot of possibilities if First REIT can capitalise on this opportunity.

Nippon72 ( Date: 14-Jan-2025 20:37) Posted:

I was thinking aloud if the divvy is 9% at today' s cost, we could recoup our capital in about 11 yrs. On the premise First Reit is still ongoing concern & does not go belly up.

With this current low cost base, the absolute return for (on 11th yr) would be 0% if it does go bust. Or 4.5% pa if share price tanks by half from current. added bonus if both price gain & divvy is included.

I think is a worthwhile calculated risk. Not too sure my thought is flawed?

30 cents thereabouts

Bob-The-Builder ( Date: 14-Jan-2025 10:46) Posted:

Do you happen to know the net asset value of First Reit?

Trainner ( Date: 14-Jan-2025 09:11) Posted:

The last valuation for the Indonesia asset is S$849.1M which is more that the total market cap. If First REIT is able to sell above the valuation, it will be good to enhance share holder value. The $ can be used for special div or re-invest into other properties for better return.

Do you happen to know the net asset value of First Reit?

Trainner ( Date: 14-Jan-2025 09:11) Posted:

The last valuation for the Indonesia asset is S$849.1M which is more that the total market cap. If First REIT is able to sell above the valuation, it will be good to enhance share holder value. The $ can be used for special div or re-invest into other properties for better return.

Joelton ( Date: 14-Jan-2025 08:55) Posted:

Siloam International Hospitals expresses intent to acquire First Reit&rsquo s Indonesia hospital portfolio

The private healthcare player operates the trust&rsquo s healthcare properties in the country

THE manager of First Real Estate Investment Trust : AW9U 0% (Reit) said on Monday (Jan 13) that it received a preliminary non-binding letter of intent (LOI) from Siloam International Hospitals to acquire the Reit&rsquo s portfolio of hospital assets in Indonesia.

Siloam is the existing operator and tenant of these assets.

The board of First Reit&rsquo s manager will conduct a strategic review to assess the LOI and explore all strategic options for the trust, the manager said in a bourse filing.

&ldquo Through the strategic review, the board is committed to undertaking a rigorous process to consider all options relating to the business of First Reit, which may include but are not limited to, exploration of joint ventures, strategic partnerships, asset acquisitions and/or asset divestments,&rdquo said the manager.

This will be done with the view of delivering &ldquo sustainable, long-term value&rdquo to First Reit&rsquo s unitholders, the manager added.

However, there is no certainty that any transaction will arise from the strategic review or LOI, or that a binding agreement will be reached regarding any of First Reit&rsquo s assets, it noted.

First Reit has 15 properties in Indonesia, comprising 11 hospitals, two integrated hospitals and malls, one integrated hospital and hotel, and one hotel and country club.

Its Indonesian healthcare properties are operated by Siloam, a private healthcare player listed on the Indonesia Stock Exchange. Siloam is majority-owned by a fund managed by CVC Capital Partners.

In First Reit&rsquo s 2023 annual report, the group noted that Siloam was its largest tenant.

The healthcare provider and its subsidiaries contributed 38.7 per cent of First Reit&rsquo s rental income in FY2023, excluding FRS 116 rental straight-lining adjustments.