SINGAPORE (July 17): Keppel-KBS US REIT announced 2Q18 ended June DPU came in at 1.50 US cents (2.04 cents), 0.7% higher than its initial public offering (IPO) forecast of 1.49 US cents.

Gross revenue for 2Q18 was US$22.6 million ($30.8 million), 2.1% lower than the forecast of US$23.1 million.

With property expenses 7.2% lower than forecast at US$8.85 million, net property income (NPI) for 2Q18 was 1.5% higher than forecasted at US$13.8 million.

This higher NPI was supported by overall rental growth, lower property expenses, and a one-off compensation income recognised in 1Q18 arising from an early lease termination at Westmoor Center in Denver, Colorado. The space was taken up in July 2018 by an existing tenant who was expanding its space, and cash rental contribution will commence in Dec 2018.

In 2Q18, the REIT recorded fair value change in derivatives of US$1.37 million, which was not in its forecast at IPO. Keppel-KBS US REIT was listed on Nov 9, 2017.

The REIT saw positive leasing momentum in 2Q18 with 32 new leases totalling to more than 222,000 sq ft secured during the period, bringing committed portfolio occupancy to 90.3% as at Jun 30, compared to 89.8% as at Mar 31.

In its outlook, the REIT manager says it is actively pursuing accretive acquisitions in key growth markets to capture further value and key upsides where the REIT has a presence in, as well as other US cities with similar growth characteristics.

Units in Keppel-KBS US REIT closed at 86 US cents on Tuesday.