KEPPEL real estate investment trust (Reit) reported a distribution per unit (DPU) of 2.93 Singapore cents for the second half of the fiscal year ended December, up 4.6 per cent from its DPU of 2.80 cents in the year-ago period.

This brought the Reit's full-year DPU for the whole of FY 2020 to 5.73 Singapore cents, a 2.7 per cent increase from 5.58 Singapore cents in FY 2019.

Keppel Reit unitholders will receive their distributions for the second half of the year on March 1.

Distributable income for the second half of the year rose 5.5 per cent to S$99.8 million from S$94.6 million in the year-ago period. This lifted the Reit's distributable income for FY 2020 to S$194.6 million, some 2.8 per cent higher than S$189.3 million for FY 2019.

Keppel Reit said the improvement was due primarily to contributions from T Tower and Victoria Police Centre, as well as lower borrowing costs.

However, this was partially offset by the absence of income from Bugis Junction Towers which was divested in November last year, as well as the impact of Covid-19 tenant relief measures and the cessation of rental support.

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For the second half of 2020, Keppel Reit's net property income attributable to unitholders rose 17.3 per cent to S$68 million.

Portfolio-wise, the Reit has a committed occupancy of 97.9 per cent and a weighted average lease expiry (WALE) of 6.7 years as at the end of 2020.

For FY 2020, Keppel Reit said it had a tenant retention rate of 72 per cent due mainly to non-renewals at One Raffles Quay and Marina Bay Financial Centre.

The Reit added that more than half of the non-renewed spaces have since been committed to new and expanding tenants.

The Reit's "active portfolio optimisation efforts" in 2020 include the practical completion of the Victoria Police Centre in Melbourne, and the acquisitions of Pinnacle Office Park in Sydney and Keppel Bay Tower in Singapore.

As at end 2020, Keppel Reit has some S$835 million of undrawn credit facilities available, including S$367 million worth of committed facilities.

Looking ahead, the manager of Keppel Reit said the high portfolio committed occupancy, long WALE and established tenants from diversified sectors will continue to support its income resilience.

Said the Reit: "While telecommuting has become widely adopted during the Covid-19 pandemic, the manager believes that physical offices will remain a necessity, although the form and functions of the office will evolve."

"The manager will continue to optimise Keppel Reit's portfolio and calibrate its leasing and investment strategy to meet potential shifts in occupier demand."

Units in Keppel Reit closed flat at S$1.18 on Monday prior to the results announcement.