Lower rental support, property sale hit Keppel Reit's Q4 DPU

Lower rental support made a dent in Keppel Reit's fourth-quarter distribution.

Distribution per unit (DPU) fell to 1.43 cents in the three months to Dec 31, from 1.48 cents a year earlier.

This will be paid on Feb 28 and brings total DPU for the year to 5.7 cents.

Gross revenue was up 10.9 per cent to $44.4 million, while net property income rose 15.3 per cent to $36.2 million, due to higher property income from Bugis Junction Towers and Ocean Financial Centre.

The full-year numbers were more muted with gross revenue up 2 per cent to $164.5 million for the 12 months to Dec 31, while net property income rose 2.2 per cent to $131.2 million.

Besides lower rental support for the full year, there was less in terms of one-off income and the absence of other gains distribution.

The divestment of 77 King Street in Sydney in January 2016 also affected distributions.

  • AT A GLANCE

  • PROPERTY INCOME: $164.5 million (+2%)

    INCOME AVAILABLE FOR DISTRIBUTION: $190.7 million (-8.4%)

    DISTRIBUTION PER UNIT: 5.7 cents (-10.5%)

The trust usually collects income from pre-termination lease payments, which are essentially one-off lump sums paid by tenants who surrender leases prematurely.

Mr Tan Swee Yiow, chief executive of the Reit manager, told a briefing yesterday that there were not as many of these in the year.

There was also less rental support at Ocean Financial Centre and Marina Bay Financial Centre Tower 3. In addition, the trust had distributed about $11 million in capital gains made from divestments in 2016. The sale of 77 King Street also reduced income in the next fiscal year.

Keppel Reit units closed unchanged at $1.32 yesterday.

A version of this article appeared in the print edition of The Straits Times on January 24, 2018, with the headline 'Lower rental support, property sale hit Keppel Reit's Q4 DPU'. Print Edition | Subscribe