Singapore-listed Keppel REIT announced on 19 July that it has achieved a distribution per unit (DPU) of 1.61 Singapore cents for its 2Q 2015, a fall of 6.4% compared to the 1.72 cents recorded for 2Q 2015.
Correspondingly the office REIT’s gross revenue and net property income (NPI) for the quarter fell by 5.6% and 6.5% year-on-year and came in at SGD40.5 million and SGD32.5 million respectively.
The REIT has attributed the fall in numbers mainly to the absence of contribution from the Australian property, 77 King Street, which was divested in 1Q 2016.
“Excluding contribution from 77 King Street, property income and net property income for the current portfolio remained stable in 2Q 2016”, said Keppel REIT in its statement on the results.
“Despite the subdued office market, the manager achieved positive rent reversion of approximately 2% for new, renewal and forward renewal leases in the first half of 2016”, said the REIT, claiming that its Singapore offices command above-market rents due to the portfolio's grade and location.
Keppel REIT’s gearing for the quarter was at 39% with average cost of debt at 2.55%.
“The manager believes that Keppel REIT is well positioned to weather the current challenging conditions, supported by its proactive leasing and capital management, as well as its sterling property portfolio and quality tenant profile”, it added.
Units of Keppel REIT finished the trading day about 1.4% lower from its previous close on the Singapore Exchange to end at SGD1.08.