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Keppel-KBS US Reit's Q2 DPU surpasses forecast at 1.5 US cents despite tenant exit

KEPPEL-KBS US Reit's second-quarter distribution per unit (DPU) crept up to 1.5 US cents from its forecast of 1.49 US cents, it said on Tuesday.

This was despite a drop in rental from a tenant at Westmoor Center which vacated the premises ahead of its lease expiry.

That said, the tenant had paid a compensation fee in the first quarter of 2018 which the trust said will be used to offset the drop in rental income and maintain distribution from the second to fourth quarter of 2018 until the replacement tenant starts contributing cash rental income.

Second-quarter income available for distribution edged up 0.1 per cent from forecast to US$9.5 million from the year-ago period.

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For the three months ended June 30, gross revenue shrank 2.1 per cent to US$22.6 million from the previous year due to the tenant that vacated.

But net property income crept up 1.5 per cent to US$13.8 million from the year-ago period, thanks to lower net property management fees and lower actual property expenses. 

The trust's properties include office developments in key growth markets of the United States. The trust only listed last November.

The book closure date is July 27. Distributions will be paid on Sep 25.

Units of the trust closed flat at S$0.865 on Tuesday.