Keppel Pacific Oak US REIT property, Westmoor Center (Photo: Keppel Pacific Oak US REIT)Keppel Pacific Oak US REIT property, Westmoor Center (Photo: Keppel Pacific Oak US REIT)

The unit price of Singapore Exchange (SGX)-listed Keppel Pacific Oak US REIT finished 39.6% lower at the close of the trading day on 15 February.

This precipitous fall in unit price came after the REIT announced that it would halt distribution to unitholders as part of a recapitalisation plan.

Keppel Pacific Oak US REIT (KORE) is a US-focused office REIT that owns a portfolio of 13 assets across the country.

The REIT disclosed on 15 February that it is suspending distributions beginning in the second half of 2023.

KORE expects the period of the suspension will be through to the second half of 2025 in respect of distributions that would otherwise be paid in the first half of 2026.

“The manager believes that this option is expected to provide significantly more capital for KORE over the next two years compared to the capital that an EFR can raise in the current market condition”, said the REIT.

As a result of the suspension, other US-focused office REITs also felt the effects from the decision.

Prime US REIT, which has yet to disclose its results, finished the trading day 32.22% lower from its previous close to end at USD0.101.

Similarly, Manulife US REIT, which had earlier suspended its distributions, finished the trading day about 6.67% lower from its previous close to end at USD0.056.

Besides the suspension of distributions, KORE also announced its financial results for FY 2023 on 15 February.

In the results, the REIT noted that its revenue for the year grew by 1.9% year-on-year.

KORE was last done on the SGX at USD0.151.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.