AIMS AMP Capital Industrial REIT: 2nd AGM.

Northtech

Some readers are concerned that I am divesting my investment in AIMS AMP Capital Industrial REIT. Is there a change in its fundamentals? Is it going down from here?

 I did blog about my reasons for partially divesting my investment in AIMS AMP Capital Industrial REIT. In a nutshell, I am just re-balancing my portfolio to reduce over-exposure to this REIT. It is a risk management exercise, nothing more.

 If my total portfolio size were twice or thrice as large as it is now, I would probably not reduce my investment in the REIT. I could, in fact, increase my long position in the REIT. Now, how's that for re-assurance?

 The presentation at the second AGM shows a robust set of numbers:

Earnings per unit: 2.75c
Gearing: 31.9%
Interest cover ratio: 4.9x
No debt due until October 2013.

27 Penjuru Lane



What I would like to see is the REIT increasing the share of high tech space and better quality logistics buildings in its portfolio. Currently, high tech space account for only 17.7% of its portfolio.

Although its acquisition of 27 Penjuru Lane and 29 Woodlands Industrial Park E1 (Northtech) are steps in the right direction, it has to do more and stay vigilant, looking out for more yield accretive purchases.

The management also plans to carry out asset enhancements for selected properties in the year 2012. I like this since many of the REIT's properties have yet to take advantage of their plot ratios to the maximum. So, even without further acquisitions, we could see the REIT's distributable income increasing with asset enhancements.

After two years, this REIT seems well managed by the team from AIMS and AMP Capital and my leap of faith has paid off nicely so far. I look forward to more good news in future.

Substantial shareholders:
AMP Capital Investors (Luxembourg No. 4) S.A.R.L. 15.35%
Dragon Pacific Assets Limited 11.98%
APG Algemene Pensioen Groep N.V. 9.42%
Universities Superannuation Scheme Limited 8.19%
George Wang 7.19%

See presentation slides here.

My very first blog post on the REIT in December 2009:
AIMS-AMP Capital Industrial REIT (MI-REIT).

Related posts:
AIMS AMP Capital Industrial REIT and Sabana REIT.
Balancing AIMS AMP Capital Industrial REIT and Sabana REIT.
Mr. Market is always right.

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