Viva Industrial Trust’s (VIT) strong set of 3Q17 results were within expectations. 3Q17 revenue increased 16.8% YoY to S$28.3m, mainly due to additional contributions from 6 Chin Bee Avenue and VBP. 3Q17 NPI increased 18.3% YoY to S$20.6m. 3Q17 DPU increased 5.0% YoY to 1.9 S cents, or 24.8% of our full-year forecast.

We note that the Downtown Line Station at Expo opened on 21 Oct 2017 as expected, and believe that the better accessibility now afforded at UE Bizhub will be a positive rental reversion catalyst. We continue to see upside for VBP given that only 87.3ppt of the 96.2% committed occupancy for “white space” contributed to 3Q17 income.

We place our Hold and fair value of S$0.895 under review as we update our model.

Source: OCBC Research - 27 Oct 2017