Keppel DC REIT's property in Tampines, Singapore, known as Keppel DC Singapore 2 (Photo: REITsWeek)Keppel DC REIT's property in Tampines, Singapore, known as Keppel DC Singapore 2 (Photo: REITsWeek)

Keppel Data Centre (DC) REIT (SGX:AJBU) announced on 15 October that it has beaten 3Q2015 forecast for distribution per unit (DPU) by 2.5% despite missing net property income (NPI) figures for the quarter.

The Singapore-listed REIT recorded year-to-date NPI of SGD69.5 million for the quarter, surpassing its IPO forecast of SGD68.3 million by 1.7%. However for 3Q2105, NPI of SGD21.4 million was 0.3% below IPO forecast.

Management for the REIT has attributed this mainly to higher property tax expenses and foreign exchange losses from the depreciation of AUD and EUR against SGD.

“The distributable income for 3Q 2015 was 2.2% above IPO forecast due to the realised gains from the settlement of foreign currency forward contracts as well as lower interest expenses due to the interest rate swaps entered into”, said the REIT in its announcement.

Correspondingly DPU of 1.64 Singapore cents for the quarter is 2.5% than the forecast of 1.6 Singapore cents made during IPO.

The REIT’s aggregate leverage has risen from 26.4% to 30.1% following the acquisition of Intellicentre 2 in Sydney while portfolio occupancy has risen from 94% to 95.1% during the quarter. Portfolio weighted average lease expiry (WALE) by leased lettable area is currently at 8.9 years.

Management of Keppel DC REIT has said that it expects demand for data centres to continue. “The increasing outsourcing of data centre bodes well for the REIT’s co-location business as well”, it said. “Corporates are increasingly outsourcing their data centre requirements as businesses seek capital and operational efficiency”, it added.

Units of Keppel DC REIT last traded at SGD1.045 on the Singapore Exchange.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.