Keppel REIT - Maybank Research 2025-01-31: Robust Operations, Elevated Gearing Unchanged

• Keppel REIT reported 2H DPU of S$2.8 cents, flat h-o-h/-3.4% y-o-y. Acquisition-led top-line growth was offset by higher borrowing cost.
• We cut our estimates for FY26 and lower our DDM-based Keppel REIT's target price to S$1.00 from S$1.05. Maintain BUY.

Occupancy improving; continued positive reversions

• - Read this at SGinvestors.io -
• - Read this at SGinvestors.io -
• The portfolio achieved strong rental reversion of 13.2% and maintained a high portfolio committed occupancy of 97.9% (3Q 97.6%) through proactive asset management, bolstered by the flight-to-quality trend. Increase in occupancy was mainly due to higher occupancy of 2 Blue Street.
• Keppel REIT’s Singapore office leases had a weighted average signing rent of about S$12.56 psf pm in FY24 (S$12.93 psf pm in 3Q, S$12.63 psf pm in 2Q). Notwithstanding the slowdown in signing rent, commentary suggests healthy leasing demand and positive reversion in FY25 as average expiring rent (S$11.31) is below spot.

Capital management

• Read more at SGinvestors.io.

Krishna Guha Maybank Research | https://www.maybanktrade.com.sg/ 2025-01-31 SGinvestors.io

---