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KOREReitUSD
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Kep-KBS Reit
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superstartup
Supreme |
13-Jul-2023 12:14
Yells: "Enjoy doing Fundamental Research" |
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Gonna hold long term for the bargain yield But still hope price will go up soon and catch up with their US listed peers to serve as good comfortable capital gain support for the long term holding for yield
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superstartup
Supreme |
13-Jul-2023 12:10
Yells: "Enjoy doing Fundamental Research" |
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Watch KepPacOak, Prime With end of Fed Tightening in sight Both yet to catch up with US listed peers Hopefully the upwards momentum coming soon |
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Joelton
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30-Jun-2023 10:29
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Kore&rsquo s focus on US suburbs could pay off amid Fortune 500 exodus from traditional gateway cities
The upgrading and addition of amenities such as in-house cafes, gyms and conference facilities have helped Keppel Pacific Oak US Reit outperform its peers, analysts say.
FROM the window of a suite in Keppel Pacific Oak US Reit&rsquo s : CMOU +1.69% (Kore) One Twenty Five office asset in Dallas, a familiar brand name can be seen emblazoned on a building a block away: Caterpillar.
The construction equipment manufacturer in June last year announced the move of its global headquarters from Deerfield in Illinois, to Dallas-Fort Worth in Texas.
In a statement, Caterpillar chairman and chief executive Jim Umpleby described the move as being &ldquo in the best strategic interest&rdquo of the company as it seeks &ldquo profitable growth&rdquo .
Caterpillar is among many Fortune 500 companies shifting offices in search of lower costs.
The list is long: Boeing, pharmaceuticals distributor McKesson Corporation, Oracle, Tesla, Tyson Foods, United Airlines and drugstore operator Walgreens are among them. Once-popular gateway cities such as New York, San Francisco, Los Angeles and Chicago are losing their appeal.
&ldquo Gateway cities are the places where we used to have all the new ideas and new developments. They were the creative places, and you saw the new industries born there. It&rsquo s where people really wanted to be,&rdquo said David Snyder, CEO of Kore&rsquo s manager. &ldquo Starting 20 years ago, we began seeing all of that shift away.&rdquo
In their moves, companies are also seeking favourable business regulations, cheaper housing for their employees and lower tax rates &ndash for both corporates and individuals.
Additionally, some of these traditional gateway cities have been rocked by rising crime rates.
In New York City, for example, more than 170,000 felony crimes were reported in 2022. This represented an increase of some 20 per cent year on year, and was the highest level since such statistics became publicly available in 2006.
Their quest for better office locations have brought many of these companies to Texas and Florida, where, happily, Kore has properties, Snyder noted. &ldquo The majority of the companies that have left California have moved into our markets&hellip It&rsquo s definitely a trend that accelerated during the pandemic.&rdquo
Room for growth
Kore&rsquo s portfolio comprises 13 office properties across eight cities. It has three properties in Seattle, Washington two in Denver, Colorado five in the state of Texas, across the cities of Austin, Dallas and Houston and one each in Nashville, Tennessee Orlando, Florida and Sacramento, California.
Following a site visit to five of these cities &ndash Nashville, Dallas, Houston, Denver and Seattle &ndash UOB Kay Hian (UOBKH) analyst Jonathan Koh observed &ldquo vibrancy in the local economies and growth from domestic tourism&rdquo .
Koh added: &ldquo In-migration and population expansion at these growth cities should cushion the negative impact from hybrid arrangements and remote work.&rdquo
Kore&rsquo s properties tend to be in the more vibrant suburban submarkets, instead of downtown areas.
&ldquo Downtown locations in most of the markets that we&rsquo ve visited appear to be very quiet, especially post-Covid,&rdquo said DBS analyst Rachel Tan. &ldquo (Whereas) selected submarkets in the respective growing cities are still active&rdquo .
Thanks in part to its locations, Kore&rsquo s tenants tend not to be the professional firms or financial services companies &ndash among which there has been a greater structural shift towards hybrid work.
&ldquo The big advantage with suburban submarkets is you don&rsquo t usually have big accounting firms, big law firms, and big consulting firms in your buildings. The trend (for these big firms) started a long time ago &ndash not just post-Covid &ndash where they give up space at every lease renewal,&rdquo Kore&rsquo s Snyder said. &ldquo We don&rsquo t want the types of tenants that constantly shrink we want tenants that generally, on average, grow.&rdquo
The strategy appears to be paying off. As at Mar 31, Kore&rsquo s portfolio committed occupancy stood at 91.9 per cent &ndash the highest among Singapore-listed real estate investment trusts (S-Reits) with a focus on US office assets.
Recent filings for Prime US Reit : OXMU -2.33% and Manulife US Reit : BTOU -1.16% show occupancies at 88.6 per cent and 86.1 per cent, respectively.
&ldquo We&rsquo ve got higher overall occupancy in large part because we have better tenancy,&rdquo Snyder explained. &ldquo We&rsquo ve got a lot more technology and a lot more healthcare tenants both of those are generally recession-proof.&rdquo
No to &lsquo elephant hunting&rsquo
Snyder is not a fan of &ldquo elephant hunting&rdquo &ndash going after tenants that take up larger chunks of space. &ldquo When you have really concentrated tenants, any one of them having a problem is a big issue for you,&rdquo he said.
Kore&rsquo s top tenants account for only 24 per cent of total income, whereas its US office S-Reit peers have concentration ratios of 33 per cent to 40 per cent. Also, no single tenant accounts for more than 3.5 per cent of income.
In the current environment, one analyst said, this is a good thing.
&ldquo The lack of anchor tenants and concentration risk has greatly aided in a post-pandemic leasing environment in which most anchor tenants are seen to be downsizing and typically moving to newer buildings in the market to suit their revamped office space needs,&rdquo said RHB analyst Vijay Natarajan.
This focus on smaller tenants has also allowed Kore to build &ldquo speculative suites&rdquo , or spec suites. These are move-in-ready spaces designed to attract tenants.
&ldquo We build spec suites as a matter of course. At any given moment, we usually have multiple spec suites that are available or that we&rsquo re about to start building,&rdquo said Snyder.
Such spec suits, alongside landlord-managed amenities such as in-house cafes, gyms and conference facilities, have helped Kore outperform its peers, RHB&rsquo s Natarajan added.
&ldquo These efforts have paid dividends in Kore&rsquo s operational data,&rdquo Natarajan noted. &ldquo Since listing or acquisition, its portfolio value &ndash on a like-to-like basis &ndash has increased 20 per cent, despite Covid-19 and rising work-from-home trends, with all but two of its 13 assets seeing valuations increase.&rdquo
Snyder thinks work-from-home policies are &ldquo a short-term phenomenon&rdquo .
&ldquo Most major companies in the United States have brought everybody back three days a week. Most of them will get to four days a week, I believe, within 12 to 18 months. That&rsquo s considered full occupancy,&rdquo he said.
The bigger threat is artificial intelligence (AI), which is &ldquo empowering people to be more efficient&rdquo .
&ldquo That means you may need fewer employees,&rdquo Snyder said. &ldquo If you&rsquo re a smart office landlord, you should be looking at AI, like we are, and asking: &lsquo What does that mean for office demand in the future?&rsquo &rdquo
&ldquo We&rsquo ve got a lot of tech companies that still need creative people, which is difficult for AI to replace&hellip And medical, you can&rsquo t do without people,&rdquo he added. &ldquo I think we&rsquo re better prepared for AI because of our tenant base.&rdquo
As at Mar 31, close to half of Kore&rsquo s portfolio by net lettable area comprises tenants from the technology, advertising, media and information as well as medical and healthcare industries. The manager deems to be &ldquo growing and defensive sectors&rdquo .
Snyder has convinced several analysts that he is on the right track. &ldquo We believe the strategies employed by the asset managers of Kore, coupled with supportive market fundamentals, could drive more resilience than what the market is pricing in,&rdquo said DBS&rsquo Tan.
&ldquo The office market outlook is challenging but with a highly uneven impact: dependent on city, location, amenities, and building use. This is where we see Kore&rsquo s differentiation, as its US assets are mainly in better submarkets and used primarily for research and development (R& D) with limited tenant concentration risks,&rdquo added RHB&rsquo s Natarajan.
UOBKH, DBS and RHB all have &ldquo buy&rdquo recommendations on Kore, with target prices of between US$0.64 to US$0.68
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SmallSmall
Supreme |
08-Jun-2023 14:03
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Time to move .... If DigiCore can move this one can also | ||||
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SmallSmall
Supreme |
08-Jun-2023 08:43
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COMPANY UPDATE
Keppel Pacific Oak US REIT (KORE SP)
BUY | Price/Tgt: US$0.305/US$0.68 | Mkt Cap: US$318.6m
Resiliency From Growth Cities And Rich Amenities
We visited nine office properties across five US cities, namely Nashville, Dallas, Houston, Denver and Eastside Seattle &ndash Bellevue and Redmond, which are growth cities benefitting from in-migration. KORE has invested in a rich array of amenities, which are vital for attracting new tenants and retaining existing ones. We also toured the office premises of FleetCor Technologies, Gogo Business Aviation, ZimVie and Meta Quest, which are KORE&rsquo s top 10 tenants. Maintain BUY. Target price: US$0.68.
· Growing with growth cities. We visited nine office properties in Keppel Pacific Oak US REIT&rsquo s (KORE) portfolio covering five US cities, ie Nashville (supernova), Dallas (super sunbelt), Houston (super sunbelt), Denver (18-hour) and Eastside Seattle &ndash Bellevue and Redmond (multi-talented producer). We observed vibrancy in the local economies and growth from domestic tourism. In-migration and population expansion at these growth cities should cushion the negative impact from hybrid arrangements and remote work.
· High quality of finishing for renovated office space. KORE has consistently invested in a rich array of amenities, such as cafeteria/pantry areas, gyms and meeting rooms/ auditoria, which are vital for attracting new tenants and retain existing ones. It has invested in spec suites at One Twenty Five in Dallas, 1800 West Loop South and Bellaire Park in Houston and The Plaza Buildings in downtown Bellevue, which are ready for immediate occupation. KORE engages interior designers to create a consistent ambience for common areas, amenities and spec suites.
· Interactions with key tenants. We toured the office premises of KORE&rsquo s top 10 tenants, such as FleetCor Technologies, Gogo Business Aviation, ZimVie and Meta Quest. Its tenants appreciate and utilise the amenities in common areas. Physical occupancy is also at healthy levels, especially at R& D facilities for tenants in the technology, communications and medical devices sectors.
· Resiliency despite slowdown in broader economy. On a portfolio-wide basis, KORE has strong physical occupancies of 64%, compared with the nationwide average of 50% for the US (Manulife US REIT: 30%, Prime US REIT: 56%). KORE&rsquo s portfolio occupancy was 91.9% as of Mar 23. Leases accounting for 10.6% of cash rental income are expiring during the rest of the year. Management has actively engaged tenants to assess their long-term space requirements. Portfolio occupancy is expected to stay above 90% due to backfilling of vacant office space.
· Maintain BUY. The site visits reflect KORE&rsquo s commitment to transparency, which is a hallmark of good corporate governance. Our target price of US$0.68 is based on DDM (cost of equity: 9.0%, terminal growth: 2.2%).
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superstartup
Supreme |
23-May-2023 15:18
Yells: "Enjoy doing Fundamental Research" |
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Manulife up 25% Prime, KeppacOak. Your turn ?
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superstartup
Supreme |
23-May-2023 14:34
Yells: "Enjoy doing Fundamental Research" |
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Manulife up 20% lor Everyone still waiting? In any case, Pls do your own DD
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superstartup
Supreme |
23-May-2023 13:40
Yells: "Enjoy doing Fundamental Research" |
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Manulife reit up 17% now Prime reit KeppacOak Reit Next to follow? (All in similiar sectors) |
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VINUASAM
Member |
17-May-2023 11:29
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going down every trading day. | ||||
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eagleeyes1989
Master |
17-May-2023 09:26
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https://www.reuters.com/world/us/blackrock-call-staff-back-office-least-four-days-week-memo-2023-05-16/BlackRock to call staff back to office at least four days a week - memo |
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Joelton
Supreme |
20-Apr-2023 10:25
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KORE' s 1QFY2023 income down but analysts stay upbeat
Keppel Pacific Oak US REIT has reported lower distributable income for its 1QFY2023. However, analysts from UOB Kay Hian, RHB Singapore and DBS Group Research have all kept their " buy" calls on this counter, citing its attractive yield and hefty discount to book value.
For the three months to March 2023, KORE reported adjusted distributable income that' s 12.5% lower y-o-y, due to higher financing costs, plus slightly lower occupancy rates.
In his April 19 note, UOB Kay Hian' s Jonthan Koh, who has a 70 US cents target price on this stock, says that KORE' s earnings was in line with his expectations.
He points out that the REIT' s manager had changed its policy to take its fees in cash starting from 2QFY2022, instead of units. As such, if fees for 1QFY2022 had been taken in cash instead, the drop in 1QFY2023 would have been of a smaller magnitude.
While the overall US office market is under strain, growth continues for properties in certain locations. KORE, for one, continues to benefit from built-in annual rental escalation of 2.4% across its portfolio. Occupancy for 1QFY203 eased 0.7ppt to 91.9%.
Koh points out that KORE, having secured a US$180 million new loan facility back in Sept 2022, has used that to refinance borrowings of US$130 million due in November and January next year. With that, KORE has no refinancing requirements till next November.
" We like KORE for its exposure to suburban office and Sun Belt states. KORE provides an attractive 2023 distribution yield of 13.8%. The stock trades at P/NAV of 0.45x (55% discount to NAV per unit)," says Koh.
Some US office properties in key cities have been hit by sharp devaluation. However, RHB' s Vijay Natarajan, citing KORE' s management, points out that KORE' s core submarkets have held up " relatively well" .
" As such, the REIT does not expect any significant decline in the valuation of its assets, of more than 5%, at this juncture. Acquisition is not a focus at present while divestments are unlikely as financing conditions remain tight, keeping buyers at bay," adds Natarajan, who has a 64 US cents target price on the stock
In its April 19 note, DBS Group Research says KORE' s management " remains comfortable" on their top 10 tenants, although it is bracing for the possibility of some small downsizing of space. In the meantime, KORE will continue to monitor shadow space in the portfolio&rsquo s submarkets.
" Although still premature, management does not expect a major decline in their asset valuation as rents continue to hold up well in most of their buildings. Management believes that potential Fed rate cuts may moderate the decline in asset valuation," adds DBS, which has a 65 US cents price target.
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Joelton
Supreme |
19-Apr-2023 11:58
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Keppel Pacific Oak US Reit posts 12.5% fall in adjusted distributable income for Q1
KEPPEL Pacific Oak US Reit : CMOU -1.35% (KORE) posted an adjusted distributable income of US$13.1 million for its first quarter ended Mar 31, 2023, down 12.5 per cent from US$14.9 million a year earlier.
This was mainly due to the divestment of properties Northridge Center I and II, and Powers Ferry in the second half of 2022, the Reit&rsquo s manager said in a business update on Tuesday (Apr 18). All three properties are freehold office buildings in Atlanta, Georgia.
The manager noted that financing costs had risen as a result of rising interest rates.
The distributable income for Q1 2022 was adjusted to assume that the base fees for that quarter were paid in cash rather than units, given that the Reit&rsquo s manager had chosen to receive all its base fees for Q1 2023 in cash.
This was &ldquo to provide a like-for-like comparison to Q1 2023 actual results&rdquo , the manager said.
Otherwise, the income available for distribution for Q1 2023 is down 21.2 per cent from Q1 2022&rsquo s US$16.6 million.
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VINUASAM
Member |
19-Apr-2023 11:02
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Singapore Results Update: Keppel Pacific Oak US REIT - 1Q23: Head and shoulders above peers. (KORE SP / BUY / US$0.365 / Target: US$0.70) Adjusted distributable income dropped 12.5% yoy in 1Q23 due to higher interest rates. Portfolio occupancy eased 0.7ppt qoq to 91.9%. Excluding Spectrum, rental reversion was positive at 4.9%&hellip from UOBKH |
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spursfan
Supreme |
18-Apr-2023 17:39
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https://links.sgx.com/1.0.0/corporate-announcements/G62QX5A98N0P4U7J/754847_MREL_KORE%201Q2023%20Key%20Business%20and%20Operational%20Updates%20slides.pdf | ||||
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prophetjul
Master |
29-Mar-2023 09:38
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Trailing yield = 16% P/NAV = 0.46 Ridiculously cheap. |
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marketuncle
Veteran |
28-Mar-2023 16:43
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US office REITs in distressed mode. Not only KORE. MUST plunged alot yesterday and PRIME also for quite sometime. US medium sized banks under pressure, tech sector (where most KORE and sizable PRIME lease are from) also under pressure. | ||||
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EricNat
Member |
28-Mar-2023 16:23
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Just bought in some last week.. and it drop so much for the past days. Any news out for this counter? | ||||
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Joelton
Supreme |
06-Feb-2023 09:24
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Analysts praise Keppel Pacific Oak US REIT for stability in FY2022, headwinds priced in
Analysts think headwinds are priced in for Keppel Pacific Oak US REIT (KORE), and while the outlook has moderated, it remains positive.
KORE&rsquo s results for FY2022 ended December were &ldquo slightly below forecast&rdquo at 96% of expectations, notes RHB Group Research analyst Vijay Natarajan. That said, valuations surprised on the upside, he adds.
&ldquo Operational numbers remained strong despite very challenging office market conditions &mdash we attribute this to assets in right markets and a strong leasing team,&rdquo writes Natarajan in a Feb 2 note.
Natarajan maintains his &ldquo buy&rdquo call on KORE with a lower target price of 69 US cents (91 cents) from 74 US cents previously.
KORE is a pure-play US office REIT listed in Singapore. Its portfolio consists of 13 freehold office assets located in Austin, Atlanta, Denver, Houston, Sacramento, Seattle, and Orlando with an aggregate net lettable area of around 4.7 million sq ft.
On Feb 1, KORE reported a 8.5% lower distribution per unit (DPU) y-o-y at 5.80 US cents for the FY2022 ended December.
The REIT&rsquo s DPU for 2HFY2022 was 2.78 US cents, 12.6% lower than the year prior.
The lower DPU was due to the REIT manager opting to receive 100% of its base fee for 1QFY2022 in the form of units and 100% of its base fee in cash from 2QFY2022 onwards.
Net property income (NPI) for the full-year period increased slightly by 1.9% y-o-y to US$84.3 million. Adjusted NPI, which excludes non-cash straight-line rent, lease incentives and amortisation of leasing commissions, increased by 2.3% y-o-y to US$85.5 million.
To RHB&rsquo s Natarajan, gearing remains &ldquo comfortable&rdquo at below 40%. Year-to-date, KORE&rsquo s share price has bounced back some 19%, but remains cheap at 30% below book and offers 10% yield.
KORE&rsquo s overall portfolio value surprised on the upside, says Natarajan, coming in relatively flat, up 0.2% y-o-y, on an absolute basis, but declined 2.7% when including capex and tenant improvements.
In comparison, its peer Manulife US REIT earlier announced a 11% valuation decline. &ldquo This again differentiates a relatively positive outlook on KORE&rsquo s submarket and its limited tenant concentration risks,&rdquo writes the RHB analyst.
Despite uncertainty and negative news flows from the tech sector, KORE&rsquo s overall portfolio occupancy remained flat q-o-q at 92.6%. Physical occupancy, meanwhile, remained at approximately 60% on average.
For FY2023, while some fluctuations in occupancy are anticipated from known tenant exits, KORE&rsquo s management remains in active discussion with various prospects and is confident of maintaining its high occupancy levels with demand staying relatively firm for smaller leases, says Natarajan. &ldquo The impact from big tech layoffs and cutbacks is not expected to be significant in its Seattle and Sacramento submarkets and overall portfolio as such. Physical occupancy in its assets have instead seen an improvement from market cool-off and is currently at c.60%, which it sees as positive.&rdquo
In addition, KORE boasts a &ldquo strong&rdquo balance sheet with 77% of its debt hedged and no debt maturing until 4Q2024. Every 50 basis points (bps) rate increase should have a 1.2% DPU impact.
Building resilience through tough times
Meanwhile, DBS Group Research analysts Rachel Tan and Derek Tan maintain their &ldquo buy&rdquo call on KORE with an unchanged target price of 65 US cents.
&ldquo KORE&rsquo s assets in the tech hubs of Seattle, Austin and Denver contribute more than 60% of its NPI. Despite a potential slowdown in the tech sector, these submarkets remain office growth markets in the US,&rdquo they write in a Feb 2 note.
DBS notes that leasing momentum slowed in 4QFY2022, with KORE completing only 102,000 sq ft compared to the 9M2022 average of 182,000 sq ft per quarter.
Management expects leasing momentum could remain muted in 1HFY2023 in view of the uncertain macroeconomic outlook but may see some recovery in 2HFY2023 as interest rates stabilise, write the DBS analysts. &ldquo Nevertheless, management are in deep discussions on some significant leases and are hopeful to close them in the near-term.&rdquo
While the US office market remains volatile, macroeconomic sentiment has stabilised as the US Fed tapers rate hikes, notes DBS. &ldquo We believe that sentiment could turn when the macroeconomic outlook stabilises. KORE is currently trading at 0.7x price-to-book (P/B), offering FY2023 yield of 10%, an attractive level to monitor as we await a potential turn in the US office market.&rdquo
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Joelton
Supreme |
02-Feb-2023 09:29
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Kore manager sees silver lining in &lsquo minor&rsquo Big Tech layoffs even as H2 DPU falls 12.6%
THE manager of Keppel Pacific Oak US Reit : CMOU +1.87% (Kore) said large-scale layoffs amid a tech sector slowdown are not a major concern for its portfolio &ndash and might even be viewed as &ldquo somewhat positive&rdquo for the US office-focused real estate investment trust (Reit).
&ldquo When you look at the layoffs for these companies in Bellevue and Redmond and compare that to what their hiring has been over the last several years, you will find that it has been just a fraction of what their hiring had been,&rdquo said David Snyder, chief executive of the Reit manager, at a briefing on Wednesday (Feb 1) following its FY2022 results announcement.
&ldquo These are very minor corrections that have been made,&rdquo he added.
For example, Snyder pointed out that Amazon had 840,000 employees in March 2020, compared with 1.54 million employees in September 2022 &ndash after the retrenchments. &ldquo Following the layoffs, they&rsquo ll still have 82 per cent more employees than three years ago,&rdquo he said.
&ldquo As odd as it sounds, we view these hiring freezes and very minor layoffs to be somewhat positive in terms of being able to get employees back to offices. Overall, for us in that market, we think that will be a plus&hellip to get our actual physical occupancy back to where it used to be,&rdquo Snyder added.
For the second half ended Dec 31, 2022, Kore posted a distribution per unit (DPU) of US$0.0278, down 12.6 per cent from a DPU of US$0.0318 a year earlier.
Kore&rsquo s manager said the drop of 12.6 per cent was because it had elected to receive 100 per cent of its base fee for Q1 2022 in the form of units, and 100 per cent of its base fee from Q2 2022 onwards in cash.
On a like-for-like basis, assuming Q2 to Q4 2021 base fees were paid in cash rather than in units, the adjusted DPU of US$0.0278 would have been 2.8 per cent lower year on year, as compared with the adjusted DPU of US$0.0286 the year before.
Distributable income dropped 10.6 per cent year on year to US$29 million, from US$32.5 million.
Gross revenue was up 1.4 per cent to US$73.9 million for the half-year period, from US$72.9 million a year earlier.
However, net property income (NPI) fell 2 per cent to US$41.3 million for the half year, from US$42.1 million, on a 5.9 per cent increase in property expenses.
The distribution of US$0.0278 per unit for the period Jul 1 to Dec 31, 2022 will be paid out on Mar 30, after books closure on Feb 9.
For the full year, gross revenue was up 4.8 per cent to US$148 million. NPI was 1.9 per cent higher at US$84.3 million, while distributable income was down 2.9 per cent to US$60.6 million. Meanwhile, full-year DPU slipped 8.5 per cent to US$0.058.
Kore&rsquo s portfolio committed occupancy increased to 92.6 per cent as at Dec 31, 2022, with 13.5 per cent of leases by cash rental income (CRI) expiring in 2023. In Q4 2022, approximately 106,495 square feet of office space was committed, equivalent to 2.2 per cent of total net lettable area.
Rental reversion remained positive at 3.8 per cent in FY2022, driven mainly by strong rents in the technology hubs of Seattle &ndash Bellevue/Redmond, noted Kore&rsquo s manager.
About 49 per cent of Kore&rsquo s tenants operate in the growing and defensive sectors of technology, advertising, media and information medical and healthcare. Its manager added that Seattle &ndash Bellevue/Redmond, which constitutes 42.7 per cent of Kore&rsquo s portfolio NPI, experienced continued positive leasing momentum in H2 2022.
The weighted average lease expiry by CRI for Kore&rsquo s portfolio and top 10 tenants was 3.5 years and 4.6 years, respectively. According to the manager, tenant concentration risk, which is considered &ldquo a key unique value proposition&rdquo of Kore, remains low with the top 10 tenants accounting for only 24.3 per cent of CRI.
As at Dec 31, 2022, Kore&rsquo s all-in average cost of debt was 3.2 per cent, with aggregate leverage and interest coverage ratio at 38.2 per cent and four times respectively. The weighted average term to maturity of Kore&rsquo s debt was 3.6 years. Its manager noted that Kore has no long-term debt refinancing requirements until the fourth quarter of 2024, as loans due in November 2023 and January 2024 were refinanced back in September 2022.
Despite concerns about the US office market over inflation and recessionary fears, and the softening of the market&rsquo s office fundamentals, Kore&rsquo s manager said it &ldquo remains focused on optimising its portfolio performance, leveraging its well-located assets in key growth markets in the US, as well as exposure to the defensive sectors of technology and healthcare&rdquo .
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mr_wealth
Member |
26-Dec-2022 20:39
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https://financialhorse.com/keppel-us-reit-trades-at-a-13-7-dividend-yield-will-i-buy-this-reit-at-0-44/
Will I buy Keppel Pacific Oak US REIT at 13.7% dividend yield?I know all the arguments why Keppel Pacific Oak US REIT is a great buy. But I&rsquo ve been staying on the sidelines all year for REITs, waiting for the macro to improve and/or better prices to emerge. I just don&rsquo t think we are there yet. When I can get 4.28% risk free on a 6 month T-Bill, I see very little need to risk capital on REITs. Not when we look to be going into a massive storm in 2023 for commercial real estate globally. That being said though, I can see a scenario where I would start adding heavily to REITs, and possibly even Keppel Pacific Oak US REIT, in the next 6 &ndash 12 months. The key factors I look at to determine whether to buy &ndash will be the global macro outlook, and pricing for the REIT. |
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