US CREDIT rating agency Equifax is now the anchor tenant for Keppel real estate investment trust’s (Reit) new Blue & William office development located in North Sydney, its manager said on Tuesday (Oct 10).

Equifax occupies more than 4,350 square metres across the fifth and seventh levels of the property, which is a third of the building’s net lettable area. It moved from two separate offices in the North Sydney area.

The manager noted that almost half of Blue & William’s office space has been leased. Other tenants include Northbrew Cafe and global consulting firm Human Synergistics, which will move in early next year.

Keppel Reit acquired Blue & William in December 2021. The 10-storey development is located at the intersection of Blue Street and William Street. Lendlease is the development and investment manager.

DBS Group Research estimates that Blue & William contributes about 4 per cent to 5 per cent of Keppel Reit’s attributable net property income on a full occupancy basis, the group said.

It added that the opening with a strong first anchor tenant bodes well for the Reit, and said the manager is strategically being selective regarding tenants to ensure income visibility during this period.

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Despite achieving half committed occupancy, the Reit has a three-year rental guarantee from Lendlease, DBS noted.

It maintained its “buy” recommendation on the counter and target price of S$1.15. The research team said Keppel Reit is trading close to a yield of 7 per cent and nearly two standard deviations above its historical range.

DBS said Keppel Reit’s price could be weighed down by investors who take a cautious stance on the near-term continued rise of interest rates.

“However, we believe at these levels, it is an attractive level for a medium-term outlook and for a turn in the interest-rate-hike cycle,” DBS said.

Keppel Reit units were trading 1.2 per cent or S$0.01 higher at S$0.84 as at 9.14 am on Tuesday.