Amid global uncertainty, AIMS APAC REIT (AA REIT) has continued to deliver resilient performance and consistently stable financial results, underpinned by its diversified portfolio of industrial assets across Singapore and Australia. 

AA REIT attributes its success to its four-pillar investment strategy — to selectively grow the portfolio, actively manage assets to enhance value, exercise prudent capital management and leverage partnerships for growth.

AA REIT has maintained strong positive rental reversions, outperforming the peer average in previous quarters, while maintaining its portfolio occupancy.

Over FY2025 ended March 31, AA REIT reported a 5.3% y-o-y increase in revenue to $186.6 million, while net property income (NPI) rose 2.1% y-o-y to $133.7 million.

Total distributions increased 5.2% y-o-y to $78.2 million, driving a 2.6% rise in distribution per unit (DPU) to 9.6 cents, supported by 20% positive rental reversions and portfolio occupancy above 95%, excluding impact from asset enhancement initiatives (AEIs) and transitory movement from tenants, while taking into account committed leases. 

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The strong performance has earned AA REIT the award for Best Returns to Shareholders over Three Years in the REIT sector at The Edge Singapore’s Billion Dollar Club (BDC) Awards 2025 — marking its second consecutive win. AA REIT’s unit price has also risen by about 11% year to date. 

“AA REIT’s diversified exposure across Singapore and Australia positions us well to capture opportunities in the industrial and logistics sectors” says Russell Ng, CEO of the REIT manager. AA REIT is well-positioned to leverage sectoral trends and the increasing investor interest in mid-cap REITs.

Strong sponsor support

For 1HFY2026, AA REIT recorded $93.7 million in revenue, up 0.2% y-o-y, and a 1.1% increase in DPU to 4.72 cents. The REIT achieved a 7.7% positive rental reversion and maintained 95.1% occupancy, excluding the impact from transitory movement by tenants, portfolio occupancy rate based on committed leases. 

Even in the face of inflationary pressures and rising geopolitical headwinds arising from the US tariffs, AA REIT’s sponsor, AIMS Financial Group, has demonstrated confidence in the industrial REIT’s prospects. In July, AIMS Financial Group acquired an additional 7% stake, bringing its total interest to 18.66%.

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“This milestone reflects our strong confidence in AA REIT’s long-term growth and reaffirms our alignment with unitholders”, says George Wang, executive chairman of AIMS Financial Group. “We remain committed to AA REIT’s four-pillar strategy for sustainable income and growth.” 

Continuous portfolio rejuvenation

AA REIT is committed to pursuing organic growth through AEIs or redevelopments on a continuous basis, which are guided by the age of a building, projected revenue profile and potential to create long-term value. 
In FY2024, AA REIT identified two assets ripe for AEI works: 15 Tai Seng Drive and 7 Clementi Loop, which were completed in 1QFY2026 and 2QFY2026 respectively.

At 15 Tai Seng Drive, targeted upgrades attracted a Temasek-linked advanced manufacturing and technology group on a 10-year lease. The refurbished 7 Clementi Loop achieved BCA Green Mark Gold Plus certification and secured a 15-year master lease with a global storage occupier. 

“Both assets will see significant uplift in building specifications, asset quality and value and are expected to deliver NPI yields above 7%,” notes Ng. “Our portfolio strength is underpinned by both portfolio and financial performance. Rejuvenating older properties into modern logistics and industrial assets strengthens long-term income stability and raises asset and earnings quality through securing high-calibre tenants.”

AA REIT has identified future organic growth pathways across its portfolio, with approximately 600,000 sq ft in Singapore and 1.5 million sq ft in Australia of development potential. These provide a future pipeline of enhancement and redevelopment projects to capture rising demand for modern industrial space.

Active capital recycling and disciplined acquisitions

Beyond redevelopment works, AA REIT continues to recycle capital from mature assets into higher-yielding opportunities like AEIs or acquisitions, demonstrating its disciplined approach to portfolio rejuvenation.

In June, AA REIT divested 3 Toh Tuck Link for $24.4 million, a 32.5% premium to the property’s valuation as at March 31, 2024. 

“We regularly assess our portfolio and will divest assets with limited rental growth potential, as well as those that require significant capital expenditure, and assets without or limited enhancement or redevelopment opportunities,” says Ng.

In August, AA REIT announced the proposed acquisition of the Framework Building at 2 Aljunied Avenue 1, a city fringe industrial building that is strategically located near the Pan Island Expressway, Paya Lebar MRT Interchange and close proximity to a wide range of retail and food amenities at SingPost and PLQ. 

This strategic addition offers secured cashflow, an attractive 8.1% property yield and immediate DPU accretion of 2.5%. A future AEI could further reposition the property to attract tenants from the healthcare, life science and advanced manufacturing sectors given the building’s high contracted power capacity. 

Upon completion, the acquisition will expand AA REIT’s portfolio to $2.18 billion across 28 properties (25 in Singapore and three in Australia). 

Ng says the acquisition aligns with AA REIT’s investment strategy of acquiring high-quality, income-generating assets with future value-add potential. “We take a patient and disciplined approach to investments, pursuing opportunities that meet our strict investment criteria. Our focus remains on Singapore and Australia, where we have deep industry know-how and track record.”

Prudent capital management

As at Sept 30, AA REIT’s aggregate leverage stood at 35.0%, with no debt refinancing until FY2027. The REIT had $169.7 million in cash and undrawn facilities, and a weighted average debt maturity of 2.5 years. 

Approximately 70% of borrowings are on fixed rates (or 69% excluding forward-starting interest rate swaps), protecting earnings amid interest rate volatility. “Our disciplined hedging strategy allows flexibility to capture benefits from any further rate cuts while maintaining downside protection.” says Ng. 

The REIT also hedges about 75% of expected distributable income denominated in Australian dollars on a rolling four-quarter basis. “Our hedge ratios consider prevailing swap rates and market conditions. Should rates fall further, our unhedged debt will benefit immediately, while refinancing of fixed-rate debt over time will lower borrowing costs,” Ng adds.

In September 2024, AA REIT secured its first sustainability-linked loan (SLL) facility of up to $400 million and A$150 million. This facility provides margin savings when the REIT meets predefined sustainability performance targets (SPTs), including reducing Scope 2 carbon emissions, expanding solar energy capacity, and increasing the proportion of green leases. 

In FY2025, the REIT achieved all its SLL performance targets, including a 25% reduction in carbon emissions from its FY2020 baseline, solar capacity of 11.82 megawatt-peak (MWp), and over 50% of leases classified as green, earning interest margin savings.

Defensive tenant mix

According to CBRE’s 2025 Asia Pacific Logistics Occupier Survey, Singapore’s logistics sector remains resilient and attractive amid global trade uncertainty, supported by continued growth in hi-tech manufacturing and life-science industries. 

Within AA REIT’s portfolio, tenants from higher-value manufacturing activities like precision engineering, healthcare and life sciences account for 15.5% of the tenant base, while logistics tenants account for 27.6%. This tenant composition reflects the REIT’s strategic shift toward high-specification, future-ready industries. 

Singapore’s push to expand its manufacturing sector by 50% by 2030 underpins demand for advanced, high-specification facilities. 

“In the past year, we have seen a pick-up in demand from higher-value manufacturing businesses and biotech and pharmaceutical related businesses, which also require sophisticated storage and logistics facilities,” says Ng. “Singapore remains an attractive regional headquarters hub, given its pro-business environment, political stability, deep talent pool and established ecosystem across various industries.”

Infrastructure investments in Australia
In Australia, demand for premium business-park and logistics space continues to strengthen, particularly in Sydney’s Macquarie Park, Norwest Business Park (Bella Vista) and Burleigh Heads in Queensland. 

Each key precinct sits within a key growth corridor backed by public- and private-sector investment.

Macquarie Park and Norwest are designated Priority Growth Zones under the NSW Government’s planning framework, promoting medium- to high-density mixed-use development supported by major transport and digital-infrastructure upgrades.

Macquarie Park is rapidly evolving into a leading innovation hub for data centre, technology, healthcare and advanced manufacturing occupiers, while Norwest benefits from inclusion in the Sydney Metro Northwest Urban Renewal Corridor, which enhances connectivity and redevelopment potential. 

Further north, Burleigh Heads is poised to benefit from Queensland’s infrastructure boom ahead of the Brisbane 2032 Olympic Games, which is catalysing logistics, transport and urban renewal projects across Southeast Queensland. These initiatives are expected to drive sustained industrial demand and long-term capital appreciation for well-located assets.

AA REIT’s Australian assets, including Optus Centre in Sydney, Woolworths HQ in Sydney and Boardriders HQ in Burleigh Heads, are also secured by long-term, triple-net leases that provide stable income and growth potential.

“With continuous infrastructure upgrades and limited supply of modern business-park assets, we expect demand for quality space to remain robust,” says Ng. “Over the longer term, tightening supply, rising land values and ongoing structural demand from technology and data centre operators will continue to drive both rental and capital growth across our Australian assets.”