AIMS REIT and CWT

AIMS REIT and CWT: AIMS REIT’s 1Q2012 results in line with rev out at 21.0m +30.8% yoy +0.9% qoq and net profit at 10.3m +85.8% yoy -0.4% qoq. DPU at 0.53c. Increase yoy was due to acquisition of 2 properties Penjuru Lane and NorthTech.

Co has also announced to redevelop 20 Gul Way into a 5 storey ramp up warehouse facility with GFA of approx 1.2m sqft. This project will be undertaken by Indeco Engineers (subsi of CWT) and afterward leased to CWT. Currently, property is a large-scale industrial facility with 10 single storey buildings relating to production, warehousing and ancillary office with total GFA of 378.1k sqft.

Project will cost $155.0m with current book value of property at $41.8m, but appraised gross value of completed project is $214.0m with NPI yield of 8.1%. Co expects to fund this using 100% debt with DPU impact at +0.293c per annum and will raise gearing to 41.5%. CWT will also be required to subscribe for a private placement of at least $2.5m in amt. AIMS expects a loss in net property income for this property of $1.9m in Mar 2012. Macq maintains Outperform at TP$0.27 citing stable 10% yield with 18% disc to book value.