Prime US REIT has reported a lower distributable income of US$8.5 million ($11.5 million) for the 3QFY2024 ended Sept 30, down 42.2% y-o-y from the same period last year.
This came on the back of lower contribution from the REIT’s Waterfront At Washingtonian on lower occupancy due to ongoing asset enhancement initiatives.
Additionally, the decrease in distributable income was attributed to higher finance expenses mainly due to incremental drawdowns on revolving credit facilities to fund capital expenditures and higher absolute interest cost.
In 3QFY2024, gross revenue dropped by 15.1% y-o-y to US$34.1 million, while net property income fell by 22.9% y-o-y to US$18 million.
The quarter just ended saw strong leasing momentum, with the REIT’s lease signings more than doubled q-o-q, increasing from 97.3 thousand sqf in 2QFY2024 to 209.8 thousand sqf.
Excluding Waterfront At Washingtonian, which was undergoing asset enhancement as at Sept 30, the REIT’s portfolio lease occupancy remained stable at 83%. According to the REIT, occupancy saw an increase for four assets in the quarter, including Waterfront at Washingtonian, Park Tower, Tower 909, and 101 South Hanley.
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The REIT adds that backfilling efforts are expected to progressively translate into improvement in leased occupancy, and higher cashflows for Prime US REIT OXMU .
As at Sept 30, the REIT’s weighted average lease expiry (WALE) stood at 4.4 years, up from 4.0 years as at December 2023.
The REIT’s aggregate leverage stood at 45.4% on a net cash basis, with an interest coverage ratio of 2.5 times as at the same period.
Units in Prime US REIT closed flat at 15.4 US cents on Nov 14.
