Singapore-listed office REIT, OUE Commercial Trust (SGX:TS0U), announced on 6 May that it has achieved a distribution per unit (DPU) of 1.44 Singapore cents, beating forecast for the period of 1.40 Singapore cents by 2.9%.

Gross revenue for the period stands at SGD20.4 million, outperforming forecast by 7.0%. “This was due to better-than-expected occupancy and higher rental reversions achieved at both OUE Bayfront and Lippo Plaza”, said the REIT in a statement announcing the results.

“Net property income of SGD15.7 million was 12.1% higher than forecast due to higher gross revenue achieved, as well as lower utilities and maintenance expenses incurred”, it added.

CEO of the REIT’s manager, Tan Shu Lin, has attributed the quarter’s results to high occupancy levels and strong rental reversions. “Portfolio committed occupancy increased from 98.0% a quarter ago to 98.6% as at 31 March 2015, and office renewal rates achieved at OUE Bayfront and Lippo Plaza were respectively 37.3% and 12.2% higher than preceding rents”, said Tan.

The REIT’s aggregate leverage stands at 38.6% as at 31 March 2015 while average cost of debt increased slightly to 2.88% per annum, up from 2.81% per annum in the previous quarter due to higher interest rates. As at 31 March 2015, 72.5% of the REIT’s interest rate exposure is fixed for the next 2.94 years.

“With limited new office space in the pipeline over the next 12 months, vacancy levels are expected to remain low, which is positive for the rental outlook in 2015”, said the REIT with regards to Singapore office properties. It is however forecasting a more subdued outlook for Shanghai office rental market due to an increase in office stock.

OUE Commercial REIT has indicated that it expects to meet its forecast amount available for distribution for the financial year ending 2015. Units of the REIT closed the trading day 0.6% higher to end at SGD0.82.