Acquisition Of Keppel Bay Tower

Acquisition Of Keppel Bay Tower Boosts Keppel REIT’s Income

SINGAPORE – Keppel REIT’s distributable income increased by 4.6 percent year-on-year to S$110.5 million in H1 2022 primarily due to the purchase of Keppel Bay Tower in May 2021, according to local bourse filings published on Tuesday afternoon (26 July, SGT).

At the same time, the Singapore-listed real estate investment trust (S-REIT) announced that its net property income (NPI) rose 6 percent year-on-year to S$89.5 million during the first half of the year.

Notably, Keppel REIT’s NPI encompasses directly-held commercial properties. These include the Ocean Financial Centre, a 50 percent stake in 8 Exhibition Street office building and 100 percent interest in the three adjacent retail units, a half-stake in Victoria Police Centre, Pinnacle Office Park, T Tower, Keppel Bay Tower after it was bought on 18 May 2021 and a 50 percent stake in 275 George Street before it was divested on 30 Jul 2021.

However, the S-REIT’s income from the share of results of associates and the share of results of joint ventures (JV) fell 4.6 percent and 24 percent respectively to S$44.6 million and S$11.7 million.

The share of results of associates pertains to Keppel REIT’s one-third stake in One Raffles Quay and Marina Bay Financial Centre (MBFC). The share of results of joint ventures pertains to Keppel REIT’s half-stake in 8 Chifley Square and David Malcolm Justice Centre.

Aside from that, Keppel REIT revealed that its office properties in Singapore recorded healthy occupancy during the first half of the year. For instance, Ocean Financial Centre (79.9 percent stake) was 92.8 percent occupied, while One Raffles Quay (33 percent stake) was 93.8 percent occupied.

Keppel Bay Tower (100 percent interest) was 95.3 percent leased, whereas Marina Bay Financial Centre recorded the highest occupancy among its Singapore office assets at 97.4 percent.

“Average signing rent for Singapore office leases concluded in H1 2022 stood at S$11.43 psf per month, reflecting robust demand for prime office space,” noted Keppel REIT.

In particular, average expiring rents of Singapore office leases is at S$9.82 psf per month for this year, S$10.81 psf per month by 2023, and S$10.72 psf per month come 2024.

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