ESR-REIT FY2025: DPU +3.4% to 21.914¢, Fitch BBB Rating Secured, S$456M in Divestments

ESR-REIT FY2025 (year ended 31 Dec 2025) delivered DPU of 21.914 Singapore cents, up 3.4% from FY2024's restated 21.190¢ (post 10:1 unit consolidation completed May 2025), marking the highest DPU in three years and signalling a strategic turnaround.

Gross Revenue rose 20.4% to S$446.0M, driven by full-year contributions from the two FY2024 acquisitions (ESR Yatomi Kisosaki DC in Japan and 20 Tuas South Avenue 14 in Singapore), positive rental reversions of +11.7% (fourth consecutive year of double-digit reversions), and AEI completions at 16 Tai Seng Street and 21B Senoko Loop. NPI grew 25.6% to S$328.7M as property expense ratios tightened. Total assets stood at S$5.9B; NAV/unit S$2.55 (FY2024: S$2.75 — decline reflecting fair valuation losses on SG industrial portfolio). Gearing 43.4%; pro-forma 38.5% assuming completion of announced divestments.

Three Singapore non-core assets were divested in March 2025 (79 Tuas South Street 5; 1 Third Lok Yang Road; 4 Fourth Lok Yang Road) for a combined S$455.8M. In December 2025 a further portfolio of 8 non-core SG industrial assets was announced for divestment at S$338.1M aggregate, targeting gearing reduction to 38.5% pro-forma. The Hotel Strata Lot at ESR BizPark @ Changi was separately announced for divestment in January 2026 at valuation. Post-divestments, the portfolio consolidates around New Economy assets (71.6% of portfolio) — Logistics and High-Spec Industrial.

16 Tai Seng Street AEI completed 3Q2025: valuation rose 14.9% to S$109.0M; occupancy temporarily soft at 50.2% as re-leasing is in progress. 29 Tai Seng Street AEI ongoing as at Dec 2025 — only 1,509sqm of 7,903sqm GFA currently lettable.

In October 2025, ESR-REIT became the first mid-cap industrial S-REIT to receive an investment-grade credit rating — Fitch BBB Stable — validating its strengthened balance sheet, disciplined capital management (WACD down to 3.35% from 3.84% FY2024) and portfolio quality improvements. This opens up broader access to global debt capital markets.

ESR-REIT's FY2025 is a turnaround story: DPU grew after three years of decline, the portfolio is being actively pruned of short-lease non-core assets, New Economy exposure exceeds 70%, and the Fitch BBB rating signals institutional credibility. The main overhang is NAV/unit compression (-7.3% to S$2.55) from fair valuation losses and land lease decay — an ongoing structural challenge for the SG industrial portfolio.