Parkway Life Real Estate Investment Trust (PLIFE REIT) owns a portfolio of 63 properties with a total portfolio size of approximately S$2.23 billion as of 31 December 2023. PLIFE REIT invests primarily in assets that are used for healthcare and healthcare-related purposes.
Most of its assets are located in Singapore (67.6%) which include Mount Elizabeth Orchard Hospital, Gleneagles Hospital, and Parkway East Hospital; followed by Japan (32.2%); and a small portion in Malaysia (0.2%). Here are eight things I learned from the 2024 PLIFE REIT annual general meeting:
1. Gross revenue increased 13% to S$147.5 million in FY2023 from S$130.0 million in FY2022. Net property income (NPI) also increased 14% to S$139.1 million in FY2023 (FY2022: $121.9 million).
2. PLIFE REIT achieved its 16th consecutive year of uninterrupted distribution per unit (DPU) growth since its IPO, excluding one-off divestment gains in FY2015 and FY2017. In FY2023, its DPU reached a record high of 14.77 cents. Distribution income increased by 2.7%, reaching S$89.3 million, up from S$87.0 million in FY2022. The increase in DPU is attributable to organic rental growth in Singapore hospitals and additional rent contributions from Japanese properties acquired in 2022 and 2023.
Source: Parkway Life REIT
3. PLIFE REIT maintains a healthy gearing ratio of 35.6%, which provides ample debt headroom from the target optimal gearing of 40%. All-in debt cost is 1.27%, which the CEO, Yong Yean Chau, highlighted as probably the lowest among Singapore REITs. The REIT’s exposure to low-interest rate markets like Japan aided the low borrowing costs. Interest coverage ratio is 11.3 times, well above the regulatory requirement of 2.5 times, underscoring the REIT’s ability to service its debt obligations comfortably.
4. The REIT maintained a committed occupancy rate of 100%, and its portfolio weighted average lease expiry (WALE) is 16.34 years. Its
