Stoneweg European REIT (SERT), formally known as Cromwell European REIT, has reported an income available for distribution to unitholders of EUR18.9 million ($28.21 million), down 4% y-o-y for the 1QFY2025 ended March 31.
This brings the REIT's indicative distribution per unit (DPU) to 3.374 Euro cents for the 1QFY2025, which is 0.3% q-o-q higher, but 3.7% y-o-y lower.
The REIT, which just welcomed its new sponsor Stoneweg Group last December, reported a net property income (NPI) of EUR33.5 million, up 2.4% y-o-y for the quarter.
The gross revenue for 1QFY2025 came in 0.5% y-o-y higher at $53.6 million.
The higher NPI was driven by higher rental income from assets such as Nervesa21 in Milan and Thorn Lightning in Durham, along with a reversal of bad debt provisions in France as two tenants paid up their arrears, the REIT says.
On a like-for-like basis, NPI rose 7.4%, reflecting the full contribution from the now fully leased Nervesa21 in Milan and higher indexation in general, the manager adds.
SERT says that all three portfolio sectors recorded strong like-for-like NPI growth: logistics/Light Industrial increased by 9.6%, office grew by 4.2%, and the 'Others' segment saw a 19.3% rise due to higher turnover rent from Starhotels Grand Milan.
The REIT's 1QFY2025 DPU was 3.7% y-o-y lower, mainly due to the full impact of higher interest expense.
In January, SERT issued a EUR500 million six-year green bond, and proceeds were used to redeem the EUR450 million bond due November 2025 fully.
This extended its weighted average debt maturity to 4.1 years with no debt maturing until late 2026.
The REIT's weighted average lease expiry came in at 5.2 years as at March 31, and total portfolio rental reversion was 1.7%.
On outlook, the manager of SERT says that Europe is vulnerable to the tariff war in the short term, but public investment is expected to raise demand in the short term. Vacancy in European logistics is expected to increase slightly in 2025 due to increased pipeline activity at the end of 2024.
The REIT aims to maintain net gearing within the board's policy range of 35-40% in the medium term, and maintain and enhance its Fitch Ratings and S&P Global Ratings BBB- Investment grade ratings.
Units in Stoneweg European REIT closed 5 cents lower or 2.315% down at $2.21 on Apr 28.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.