Published February 2, 2009

Cambridge Ind'l Trust reports 4% fall in DPU

It hopes to deliver stable DPU this year with its long average lease expiry

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CAMBRIDGE Industrial Trust (CIT) has announced a distribution of 1.373 cents per unit for the quarter ended Dec 31, 2008, said Reit manager Cambridge Industrial Trust Management Ltd (CITM).

The Q42008 DPU is 0.117 cent lower than the same period a year ago.

CIT's total net distributable income for FY2008 was $47.9 million with an annual DPU of 6.012 cents. This represents an annual yield of 21.9 per cent based on the closing price of $0.275 per unit on Dec 31, 2008, said CITM.

The annual DPU for FY2008 of 6.012 cents was a decrease of 4.0 per cent from 6.262 cents in FY2007.

Said Chris Calvert, chief executive officer of CITM: 'We are pleased to report a set of consistent results for FY2008 in this difficult economic environment.'

All its properties are signed with long leases of up to 15 years, with fixed rental escalation. The weighted average remaining lease term of CIT's existing portfolio of 43 properties remained stable at 5.7 years as at December 2008, CIT said.

As at the end of 2008, CIT has a portfolio of 43 properties with 653,673.39 square metres of lettable area valued at $995.4 million. The weighted average land lease on these properties is 39.4 years, excluding freehold property which comprises 5.4 per cent of total lettable area. About 35 per cent of the portfolio of properties is in the logistics and warehousing sector, with the next significant segment in the light industrial space accounting for 34 per cent.

The occupancy of CIT's portfolio was 99.5 per cent.

'CIT continues to place prudent capital management at the centre of its business strategy as evidenced by recent signing of term sheets with three banks under which they will commit to provide a $390 million syndicated term loan,' it said. The group's gearing was 37.8 per cent, below its long-term leverage target of 40 per cent.

CIT said its future outlook will be determined by the severity of the impact of the current financial crisis. 'However, for this financial year, CIT believes itself to be well-positioned to deliver stable DPU, with its relatively long average lease expiry of 5.7 years on top of a high 16-month security deposit,' it added.