Prime US REIT - Phillip Securities 2023-08-14: Navigating Through The Storm

Prime US REIT - Navigating Through The Storm

Prime US REIT (SGX:OXMU) | SGinvestors.ioPrime US REIT (SGX:OXMU)
  • Prime US REIT (SGX:OXMU)'s 1H23 DPU of US$0.0246 (-30.1% y-o-y) was in line with our estimates at 50% of FY23e forecast. The decline of was due to Prime US REIT increasing management fees paid in cash from 20% to 100%, higher interest expense, lower occupancy, and higher operating expenses. Excluding the change in management fees paid in cash, DPU is still down ~24% y-o-y.
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  • Maintain BUY on Prime US REIT with DDM-based target price lowered from US$0.46 to US$0.39. Prime US REIT is currently trading at 0.25x P/NAV, and we believe that most of the negatives are already priced in.
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The Positive

Extension of debt maturities.

  • During the quarter, Prime US REIT extended the maturity of its term loan and revolver under its main credit facility (~34% of total loans) by one year to July 2024. As a result, Prime US REIT has no refinancing obligations till July 2024. This gives Prime US REIT more time to secure refinancing and some respite amid the credit crunch situation in the US.

Gearing decreased 0.9ppts q-o-q to 42.8%.

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Above is the excerpt from report by Phillip Securities Research.
Clients of Phillip Capital may be the first to access the full report in PDF @

Darren Chan Phillip Securities Research | 2023-08-14

Read also Phillip's most recent report:
2024-05-13 Prime US REIT - Pricing In Some Refinancing Risk.

Previous report by Phillip:
2024-02-26 Prime US REIT - No Breach, But Refinancing Risks Persist.

Price targets by 2 other brokers at Prime US REIT Target Prices.

Listing of research reports at Prime US REIT Analyst Reports.

Relevant links:
Prime US REIT Share Price History,
Prime US REIT Announcements,
Prime US REIT Dividends & Corporate Actions,
Prime US REIT News Articles


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