Keppel Pacific Oak US REIT Units Experience Significant Drop in Value
Keppel Pacific Oak US REIT units have seen a sharp decline in value after the trust announced a drop in the value of its portfolio and a delay in releasing its 2023 financial results. This news has caused the units to fall as much as 22% to US$0.25 in Wednesday's trade in Singapore, marking their largest one-day decline to date.
The real estate investment trust, which holds a portfolio that includes The Plaza Buildings in Washington and Great Hills Plaza in Texas, revealed on Tuesday that, based on independent valuations, the value of its U.S. assets has fallen by 6.8% to US$1.33 billion as of the end of 2023.
According to the REIT, nearly 84% of the decline in the total portfolio value can be attributed to four properties in Washington. This decrease is due to a rise in capitalization rates and higher vacancy rates that are anticipated for this year.
Furthermore, Keppel Pacific Oak US REIT has stated that it will postpone the release of its 2023 results. This delay may suggest that the company wants to incorporate the latest valuation information into its earnings report.
Despite the decline in portfolio valuation, Keppel Pacific Oak US REIT ensures that its aggregate leverage remains within the regulatory limit, which allows up to 50.0% of its total assets' value. Additionally, the trust assures that there have been no breaches of any bank covenants.
All Rights Reserved © 2024
Post a comment