UNITED Hampshire US Reit’s distributable income for the third quarter ended Sep 30 declined 14.6 per cent to US$6 million, from US$7.1 million in the previous corresponding period.
The real estate investment trust’s (Reit) net property income fell 6.7 per cent to US$12 million from US$12.9 million. Revenue slipped 2.9 per cent to US$17.9 million from US$18.4 million in the year-ago period.
On Friday (Nov 8), the Reit’s manager said in a business update that the decline comes amid lower recoveries due to decreased occupancy, higher interest costs as well as absent contributions from divested properties.
The Reit divested two freestanding retail properties that were leased and occupied by hardware store company Lowe’s and warehouse store company Sam’s Club in August 2023 and this year, respectively.
For the nine-month period, distributable income was down 15.1 per cent on the year to US$18.7 million. Net property income declined 3.4 per cent to US$37.4 million.
Revenue, however, rose 0.6 per cent to US$54.7 million. This comes amid new leases and rental escalations from existing leases, as well as contributions from a new sports store.
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United Hampshire US Reit’s weighted average lease expiry (Wale) stood at 7.9 years for its grocery and necessity properties, including forward committed leases. Excluding these leases, Wale was 7.8 years as at Sep 30.
The Reit has an aggregate leverage of 39.9 per cent as at end-September and an interest coverage ratio of 2.5 times.
The manager said the Reit has no refinancing requirements until November 2026, after renewing the loan for shopping mall Arundel Plaza in February this year.
Looking ahead, the manager is cautious of market volatility caused by geopolitical headwinds and macroeconomic uncertainty.
But it added that it will remain focused on strengthening the Reit’s income streams and balance sheet, optimising the portfolio through potential acquisitions and undertaking upgrading projects for existing assets, among other means.
Units of United Hampshire US Reit closed 1.1 per cent or US$0.005 higher at US$0.46 on Thursday.
