SINGAPORE (Apr 18): The manager of Keppel REIT has declared a 1Q18 DPU of 1.42 cents, 2.1% lower than 1.45 cents recorded in 1Q17.

This was despite a 0.2% increase in income available for distribution to $48.2 million from a year ago.

Property income in 1Q18 declined 0.3% to $39.7 million mainly due to a 28.9% decrease in other income to $0.69 million.

Net property income (NPI) for 1Q18 came in at $31.2 million, 0.6% lower than $31.4 million in 1Q17.

The variances were mainly attributable to 26.5% lower property income and 31.1% lower net property income from 275 George Street. These were partially offset by higher property income and net property income from Bugis Junction Towers, Ocean Financial Centre and 8 Exhibition Street.

Share of results of associates fell 10.9% to $20.6 million while share of results of joint ventures fell 5.7% to $7.8 million.

As at end March 2018, portfolio committed occupancy remained high at 99.4% and portfolio tenant retention rate for the quarter was 93.0%.

Property consultancy CBRE remains upbeat on the Singapore office market and has observed improving confidence among the traditional finance, energy and professional services sectors. In Australia, JLL reported stronger leasing activities across Australian office markets.

Looking ahead, the manager says challenges remain amid a volatile macro environment.

Keppel REIT’s manager says that it will continue to drive stable portfolio performance through ongoing proactive tenant and lease management so as to deliver sustainable distributable income to unitholders.

A prudent capital management strategy will also be maintained to optimise the REIT’s performance in a rising interest rate environment.

Units in Keppel REIT closed 2 cents higher at $1.20 on Wednesday.

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