Keppel Land's MBFC Tower 3 acquisition could be pushed back to 2014

Keppel REIT's condition partly to blame.

According to Barclays Capital, while Keppel REIT's gearing has improved this 3Q13, it is still the highest among Singapore REITs, and will likely contribute to the delay of Keppel Land's purchase of MBFC Tower 3 to next year.

"We expect the acquisition of MBFC Tower 3 from Keppel Land only next year, even as leasing at MBFC Tower 3 has hit 90% as of Jun 13, given KREIT’s elevated 43.9% gearing and weak capital market sentiment," said Barclays Research in a commentary after Keppel REIT released its 3Q13 results.

"Gearing has improved to 43.9% from 44.2% in 2Q13, although this is still the highest gearing in the SREIT sector," it added.