Oct 27, 2021
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Year on year, Keppel REIT’s distributable income increased by 20.8% to $159.9 million, up from $132.4 million, over the same period last year.

Keppel REIT saw its distributable income increase 20.8% to $159.9 million during the first nine months of 2021, from $132.4 million over the same period last year.

In an SGX filing on Tuesday (26 October), Keppel REIT revealed that the “year-on-year improvement in distributable income, excluding any distribution of capital gains, was due mainly to contributions from Victoria Police Centre in Melbourne, Pinnacle Office Park in Sydney and Keppel Bay Tower in Singapore”.

The hike was partially offset by the impact of the divestment of 275 George Street in Brisbane.

Proceeds from 257 George Street’s divestment were used to repay debt as well as lower the aggregate leverage of Keppel REIT to 37.6% as of 30 September 2021.

Keppel REIT noted that the weighted average term to maturity of its borrowing had also been lengthened to 3.3 years during the quarter, with the issuance of $150.0 million of seven-year medium term notes at 2.07% per annum in September.

“For 9M 2021, Keppel REIT’s all-in interest rate was reduced to 1.99% per annum compared to 2.39% per annum a year ago, with interest coverage ratio1 at 3.9 times. 71% of Keppel REIT’s total borrowings are at fixed rates,” read the SGX filing.

As of 30 September, Keppel REIT’s portfolio consists of $8.6 billion of Grade A commercial properties, 80% of which are located in Singapore, 16.4% in Australia and 3.6% in South Korea.

Its portfolio has a committed occupancy of 97.1% as of 30 September, and a weighted average lease expiry (WALE) of 6.1 years. 

For 9M 2021, the REIT posted a tenant retention rate of 64%, while rental collection was at 99%.

“With accelerated vaccinations and further reopening, Grade A office buildings that are well managed with sustainable and technologically-advanced features are expected to be well sought after,” said Keppel REIT.

“The manager will continue its portfolio optimisation strategy and proactive tenant engagement to build a robust portfolio that meets diverse tenant needs.”

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Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email: cheryl@propertyguru.com.sg

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