KORE US REIT, previously Keppel Pacific Oak US REIT, has reported distributable income of US$10 million ($12.7 million) for the 1QFY2026 ended March 31, up 4.3% y-o-y.
During the quarter, gross revenue increased by 5.1% y-o-y to US$38.7 million, while net property income (NPI) grew by 13.6% y-o-y to US$22.3 million.
Excluding non-cash straight-line rent, lease incentives and amortisation of leasing commissions, adjusted NPI was up by 15.9% y-o-y to US$23.4 million. This was mainly due to higher one-off other operating income, cash rental income and lower other property expenses, offset by higher repair and maintenance as well as utilities expenses.
Aggregate leverage as at end-March stood at 43.7%, down from 44.1% a quarter ago, while the interest coverage ratio was 2.5 times.
As at March 31, KORE’s committed portfolio occupancy stood at 85.1%, 2.1 percentage points lower q-o-q. The decline reflects a known vacate of some 124,000 sq ft of space at The Westpark Portfolio. The REIT says it is in negotiations to backfill a portion of the space.
Portfolio weighted average lease expiry (WALE) stood at 3.7 years by cash rental income (CRI) and 3.5 years by net lettable area (NLA) as at March 31. During the period, the REIT’s portfolio rental reversion stood at a positive 0.8%.
See also: Alpha Integrated REIT’s 1QFY2026 portfolio occupancy improves to 91.4%
Looking ahead, KORE says US offices are at a “turning point” with leasing activity reaching post-pandemic highs. Referring to an April 6 report by real estate information company CoStar Analytics, office leasing volumes increased by 25% y-o-y in 1Q2026, exceeding pre-pandemic quarterly averages for the first time this decade and reaching the highest level since mid-2018.
The REIT adds that leasing activity is expected to pick up further in 2026, supported by lease expiries and a lack of new supply.
Other trends include demand for well-located, modern office spaces with strong amenities and flexible layouts, as well as traction in office investments.
See also: Keppel DC REIT's 1Q2026 DPU rises 13.2% to 2.833 cents
KORE also believes that the polarising income-tax systems in the US are “favourable tailwinds” for its low-tax markets including Bellevue/Redmond in Seattle; Dallas and Austin in Texas; Nashville, Tennessee; and Orlando, Florida; all of which levy no personal state income tax.
In addition, the REIT is likely to benefit from corporate headquarters relocations. Dallas - Fort Worth, Austin and Nashville are among the top five US metros attracting such moves, markets where the REIT has an established presence.
Units in KORE closed 0.1 US cent higher or 0.53% up at 19.1 US cents on April 16.
