Keppel REIT reported 1H25 DPU of S$2.72 cent, -2.9% h-o-h and y-o-y. Top-line growth and higher distribution from associates and JVs were eroded by higher borrowing expenses and receipt of fees in cash.
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Debt metrics were stable, though NAV slipped further.
Mixed operations; Elevated gearing.
Focus appears to be on portfolio growth through sub-sector diversification and capital management with upcoming perp redemption.
2Q revenue and NPI of S$67.8m and S$53.7m, +6.3% and +10.5% y-o-y, respectively. On a q-o-q basis, revenue and NPI slipped 1.3% and 1.6%. Share of results from associates and JVs for 2Q rose 1.7% q-o-q, +12.8% y-o-y. Contribution from 255 George Street, higher occupancy at 2 Blue Street drove NPI, while higher rentals for Singapore CBD assets and lower borrowing costs helped associates and JVs.
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Positive reversions; lower occupancy.
Portfolio occupancy was 95.9% (1Q 96%, 2Q24 97%) on slippages in Singapore (ORQ, Keppel Bay Tower) and Australia (Pinnacle Office Park, 8 Exhibition Street).
Portfolio rent reversion was +12.3% (1Q +10.6%) with SG signing rents of S$12.77 psf. pm. Risk of anchor non-renewals in Australia exists.
Evaluating options for capital management, diversification.
Read more at SGinvestors.io.
Above is an excerpt from a report by Maybank Research. Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.
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