Keppel REIT’s (SGX:K71U
) distribution per unit (DPU) declined 6.6% y-o-y to 5.23 cents in FY2025 for the 12 months to Dec 31, 2025, attributable to the enlarged unit base and the absence of contribution from the acquisition of 75% interest in Top Ryde City Shopping Centre and the acquisition of an additional one-third interest in MBFC Tower 3.
Property income increased 4.9% y-o-y to $274.5 million while net property income (NPI) rose 6.9% y-o-y to $215.9 million. The increase was mainly due to contributions from 255 George Street which was acquired back in May 2024, and higher occupancy at 2 Blue Street.
Share of results of associates and joint ventures was up 13.3% y-o-y to $124.6 million due to higher rentals at Singapore assets and lower borrowing costs.
As at Dec 31, 2025, Keppel REIT’s aggregate leverage stood at 47.9%, mainly due to the transitory impact of the equity bridge loans (EBL) obtained to preliminarily fund the acquisition of the additional one-third interest in MBFC Tower 3.
Keppel REIT stated that its aggregate leverage would be 40.4% if the proceeds from the recent preferential offering were received on Dec 31, 2025.
Weighted average cost of debt was at 3.41% per annum, with interest coverage ratio at 2.6 times. Excluding the transitory impact of the EBL, 62% of total borrowings was on fixed rates, and sustainability-focused funding was at 79% of total borrowings as at Dec 31, 2025.
See also: ESR-REIT's FY2025 total DPU rises 3.4% y-o-y to 21.914 cents
Debt maturity profile remained fairly staggered, with a weighted average term to maturity (WATM) of 2.4 years.
Portfolio occupancy was up marginally to 96.7% from 96.3% in 9M FY2025 given the improvement in office occupancy rate. Rental reversion for the office portfolio was at 11.5% for FY2025. Portfolio WALE was at approximately 4.4 years.
In January, Keppel REIT committed a new lease at 8 Exhibition Street with a tenant from the banking, insurance and financial services sector. The new tenant will occupy five floors at the Grade A commercial building located in the Eastern Core of Melbourne’s CBD.
Following the acquisition of 75% stake in Top Ryde City Shopping Centre and an additional one-third interest in MBFC Tower 3, Keppel REIT’s total portfolio value as at Dec 31, 2025 stood at $11.7 billion, with Singapore’s exposure increased to 79.8%, from 75.8% post-acquisition of Top Ryde City Shopping Centre.
Excluding the acquisitions, portfolio valuation would have increased by 3.4% y-o-y.
“The acquisition of an additional one-third interest in MBFC Tower 3 has increased the portfolio’s Singapore exposure to 79.8%, anchoring Keppel REIT’s presence in a strong Core CBD office market underpinned by positive fundamentals which are expected to support continued rental growth,” says Chua Hsien Yang, CEO of the manager.
“In addition, the acquisition of Top Ryde City Shopping Centre, Keppel REIT’s inaugural pure play retail investment, broadens our income base and enhances our ability to capture the resilient and growing consumer-linked trends alongside our strong office footprint. Looking ahead, we will continue to actively manage our assets to optimise operating performance and leverage the lower interest rate environment to reduce borrowing costs,” he adds.
Units in Keppel REIT closed at 98 cents on Feb 3.
