Its Singapore portfolio also enjoys a committed occupancy of 98.9%.
Keppel REIT is likely to keep up a positive rental reversion for its Singapore office portfolio, according to UOB Kay Hian.
The report noted that the REIT’s management revealed that the average rents for expiring leases are $10.70 psf pm for 2019, $9.70 psf pm for 2020, and $9.60 psf pm for 2021. Its Singapore portfolio enjoys a committed occupancy of 98.9%.
UOBKH cited a CBRE report noting that Grade A office rents in the Lion City grew 11.9% YoY and 1.4% QoQ to $11.30 psf pm, with leases committed hitting 272,900 sqft in H1. “Most leases concluded were in Singapore where the average signing rent was $11.93psf pm, above market average for Grade A office space in core CBD,” UOBKH analysts Jonathan Koh and Loke Peihao explained.
Meanwhile, Keppel REIT’s acquisition of 99.4% shares in T Tower in Seoul has been completed. “With an NPI yield of 4.7%, T Tower is expected to boost pro-forma 2018 distribution per unit (DPU) by 2.5% to $0.570 based on debt financing,” the analysts noted.
Completed in 2010, the newly acquired property in Korea’s capital boasts of a 100% committed occupancy.
“The outlook for Seoul’s office market appears robust, with office investments reaching a historical high in 2018 amid ample liquidity and positive investment sentiment,” the analysts said.
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