Office REIT CapitaLand Commercial Trust (CCT) has reported a distribution per unit (DPU) of 2.20 Singapore cents for its 1Q 2019, 3.8% higher than the 2.12 cents achieved in the corresponding period of 2018.

The REIT’s gross revenue and net property income for the quarter increased by 3.5% and 3.4% year-on-year to SG99.8 million (USD73 million) and SG79.8 million respectively.

Correspondingly, its distributable income of SGD82.7 million for 1Q 2019 represents an uplift of 8.0% from 1Q 2018.

CCT has attributed the improved performance largely to contributions from Gallileo, which was acquired in June 2018, and higher occupancy at Asia Square Tower 2.

“With monthly Grade A office rent trending upwards and limited new supply coming onstream from now until 2021, it is an opportune time to ride the positive office market cycle”, said Kevin Chee, CEO of the REIT’s manager.

The REIT’s portfolio occupancy rate was at 99.1% as at 31 March 2019, while portfolio weighted average lease expiry (WALE) by lettable area NLA is 5.7 years.

CCT’s aggregate leverage inched up slightly from 34.9% in 4Q 2018 to 35.2% in 1Q 2019, largely due to a SGD9 million debt drawdown.

Based on the annualised 1Q 2019 DPU, and CCT’s closing price per unit of SGD1.93 on 18 April 2019, CCT’s distribution yield is currently at 4.6%.