Keppel REIT - UOB Kay Hian 2023-01-30: 2H22 Marginally Below

• Keppel REIT (SGX:K71U) reported 2H22 DPU of 2.95 cents (+2.4% y-o-y), which is marginally below our expectations. The results included the first tranche of its anniversary distribution of S$10m.
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Hampered by weakness in AUD and KRW.

• Attributable NPI declined 2.4% y-o-y in 2H22 due to the divestment of 275 George Street in Brisbane in Jul 21 and the respective 6.8% y-o-y and 6.1% y-o-y depreciations in the Australian dollar and Korean won as of end-Dec 22.
• Contribution associate & JV dropped 21.4% y-o-y due to lower one-off income and lower contribution from 8 Chifley Square in Sydney (occupancy: 82.0%).

Portfolio committed occupancy remained high

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• Office properties in Singapore registered positive rental reversion of 23.4% in 4Q22. Management expects rental reversion to be positive mid-to-high single-digit due to low expiring rents of S$11.43psf in 2023.
• Keppel REIT's Portfolio WALE is long at 6.0 years (top 10 tenants: 10.5 years).

Weathering higher cost of debt.

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Above is the excerpt from report by UOB Kay Hian Research.
Clients of UOB Kay Hian may be the first to access the full report in PDF @ https://www.utrade.com.sg/.