- In the latest updated asset valuation as of 1H23, Manulife US REIT’s portfolio valuation declined by 14.6% to US$1.6bn vs US$1.9bn as at Dec 22. See Manulife US REIT's announcement dated 18 Jul 23.
Gearing spikes to 57% with another 15% decline in asset valuation
- - Read this at SGinvestors.io -
- While the gearing limit does not by itself constitute a breach, it has three other major implications on Manulife US REIT:
- - Read this at SGinvestors.io -
- cross default of interest rate swaps, which will subject Manulife US REIT to higher interest rates for its loans, and subsequently impact the ICR ratio; and
- potential implications on distributions to be declared, with Manulife US REIT expecting to report a loss in its 1H23 financial results.
- Manulife US REIT is currently in discussions with its lenders
- to waive the breach of the financial covenants,
- exploring an option to lower the ratio of total unencumbered debt vs unencumbered assets, and
- seeking approval to declare distributions.
- In the announcement, Manulife US REIT mentioned that the manager and sponsor are exploring a potential alternative method with its lenders, which may address Manulife US REIT’s mid and long-term liquidity needs.
Details on the asset valuation decline.
- Read more at SGinvestors.io.
