Keppel REIT's net property income jumped 20.7% to $34.4m

4 of its completed 7 properties are 100% occupied.

Keppel REITannounced the unaudited results of Keppel REIT for the quarter ended 31 March 2013.

The group registered a 20.7% y‐o‐y increase in NPI to $34.4 million in 1Q 2013. Higher occupancies and improved performance from OFC and 77 King Street were the main contributors to the rise of 13.2% y‐o‐y in property income.

In addition to the higher occupancy of OFC, which increased from 90.6% in 1Q 2012 to 96.6% in 1Q 2013, the increased contribution from OFC was also attributed to Keppel REIT’s acquisition of an additional 12.4% interest in the asset in June 2012. The acquisition increased Keppel REIT’s interest in OFC to 99.9%, enabling Unitholders’ to enjoy 99.9% of tax transparent income from the asset.

During the quarter, share of results of associates posted a 26.4% y‐o‐y increment to $14.2 million. The improved result was due mainly to higher contribution from MBFC Phase 1.

This was due to an increase in occupancy from 98.7% in 1Q 2012 to 100% in 1Q 2013 as well as MBFC Phase 1 being successfully converted to a Limited Liability Partnership structure in June 2012.

The conversion to a LLP structure enabled income contribution from MBFC Phase 1 to be passed on to Unitholders on a tax transparent basis. 

Distributable income for 1Q 2013 increased 7.6% y‐o‐y to $52.2 million. DPU for 1Q 2013 stood at 1.97 cents, 3.7% higher y‐o‐y, while annualised DPU of 7.99 cents was 4.6% higher as compared to a year ago.

Strong Portfolio Performance
Keppel REIT continued to strengthen its occupancy across its properties in 1Q 2013. Total property portfolio average committed occupancy rose to 98.8%. During the quarter, occupancy levels at MBFC Phase 1 and OFC improved to 100% and 96.6% respectively.

This brings four of Keppel REIT’s completed seven properties to 100% occupancy.

The Manager had been proactively managing its portfolio lease profile in 1Q 2013. For the rest of 2013, approximately 3.5% and 3.0% of portfolio net lettable area will be up for renewal and rent review respectively.

To date, Keppel REIT has a total of 222 tenants from a diverse range of business sectors spread out across its portfolio of quality office space. The weighted average lease expiry remained at healthy levels of 6.9 years for its top ten tenants and 5.7 years for the entire portfolio, by NLA.

In March 2013, 77 King Street in Sydney achieved an improved 4.5‐Stars National Australian Built Environment Rating System energy rating. The 4.5‐Stars NABERS rating was awarded to the building in recognition of the better energy efficiency and improved sustainability performance of the building.

On 28 March 2013, Keppel REIT completed the acquisition of a 50% interest in the new office tower to be built on the Old Treasury Building site in Perth, Western Australia. 98% of the NLA of this asset has been pre‐committed by the Government of Western Australia for 25 years, with options to extend for an additional 25 years.