Singapore-listed Keppel REIT has recorded a DPU of 1.60 Singapore cents for its 3Q 2016, a year-on-year fall of 5.9% from the 1.70 cents achieved in the corresponding period of 2015.

Gross revenue and net property income (NPI) for the period came in at SGD39.5 million (USD28.5 million) and SGD31.6 million, falls of 6.5% and 5.6% year-on-year respectively from figures achieved in 3Q 2015.

Accordingly income available for distribution came in at SGD52.4 million, down 3.6% year-on-year from the SGD54.4 million recorded for the corresponding period of 2015.

The REIT has attributed the results mainly to the absence of income contribution from the Sydney office property at 77 King Street, which was divested in 1Q 2016.

Keppel REIT’s overall portfolio occupancy was at 99.5% with all leases expiring in 2016 successfully renewed.

Leases expiring in 2017 and 2018 stand at 5.2% and 5.4% respectively as at 3Q 2016, with the majority of these likely to be renewed, said the office REIT.

Keppel REIT’s aggregate leverage as at 3Q 2016 was at 39%, which is unchanged from the previous quarter, and it has no refinancing requirements until 2H 2018.

“New office supply over the next one to two years, coupled with slower economic growth, will however continue to pose challenges for the Singapore office market”, said the REIT in a statement on the results on 18 October.

“The manager’s key strategic focus of proactive lease management and tenant retention to ensure a healthy and long lease expiry profile for its portfolio will provide a sustainable and stable income stream”, it added.

Units of Keppel REIT finished the trading day flat from its previous close on the Singapore Exchange to end at SGD1.12.