United Hampshire US REIT's 1Q FY24 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

Gross revenue has improved slightly YoY mainly contributed by new leases and rental escalations as well as revenue from Academy Sports + Outdoors store at St. Lucie West which commenced operation in November 2023. Despite that, NPI has declined slightly probably due to higher property expenses. Distributable income has declined significantly, as a result of higher interest rates and management fees being paid entirely in cash."

Related Parties Shareholding

The directors of the REIT manager hold a relatively high proportion of shares, while the REIT sponsor and REIT manager hold a relatively low proportion.

Lease Profile

The properties have a long WALE, with a well-spread lease expiry. Plus, the majority of these properties are freehold.

Debt Profile

The cost of debt is high, with a relatively low proportion of fixed-rate debt and no unsecured debt, which are less favorable.

Diversification Profile

The portfolio demonstrates geographical and property diversification, but tenant contributions are concentrated.

Key Financial Metrics

Property yield and operating distributable income on capital are high. In addition, the management fee is low compared to operating distributable income.

DPU Breakdown

• TTM Distribution Breakdown:
• 96.9% from Operation
• 3.1% from Management Fees Paid in Units
• TTM Distribution = 90.6% of Distributable Income

Trends

• Slight Uptrend: DPU from Operation, Committed Occupancy
• Flat: NAV per Unit, Property Yield
• Slight Downtrend: Operating Distributable Income on Capital
• Downtrend: Adjusted Interest Coverage Ratio, Operating Distributable Income Margin

Relative Valuation

• Dividend Yield - Average for 1y, 3y & 5y
• P/NAV - Average for 1y; Below -1SD for 3y & 5y

Author's Opinion

Compared to the previous quarter, there has been an increase in both gross revenue and NPI mainly due to the contribution from the new Academy Sports store at St. Lucie West. Despite the improvement, distributable income has declined due to higher interest expenses. Regarding debt, it is worth noting that there is no debt maturing within this year.

For more information, check out:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and details of Singapore REIT

REIT Review - List of previous REIT review posts

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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my findings and should not be considered professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.