United Hampshire US REIT Review @ 31 August 2022

Basic Profile & Key Statistics

• Main Sector(s): Retail & Logistics (Self-Storage)
• Country(s) with Assets: United States
  
• No. of Properties (exclude development/associate/fund): 23

Key Indicators

Performance Highlight

Gross revenue, NPI and distributable income improved yoy mainly due to the contributions from Colonial Square and Penrose Plaza that were acquired in Nov 2021 and the improved performance of the Self-Storage Properties. DPU was lowered due to the absence of one-off stipulated damages and significantly lower top-ups from self-storage properties. Excluded the one-off item and top-ups, DPU improved 13.4% yoy.

Acquisition

On 28th Jul, UHREIT completed the acquisition of Upland Square.

Divestment

Divestment for Elizabeth and Perth Amboy Self Storage properties was completed on 22nd June above purchased value.

Sensitivity to Interest Rate

For every 0.5% increase in interest rate, the impact on DPU is 0.048 cents, around 0.8%.

Related Parties Shareholding

• REIT sponsor's shareholding: Below median for more than 20%
• REIT manager's shareholding: Below median for more than 20%
• Directors of REIT manager's shareholding: Above median for more than 20%

Lease Profile

• Occupancy: ± 5% from median
• WALE: Above median for more than 20%
• Highest lease expiry within 5 years: Below median for more than 20%; Falls in 2024
• Weighted average land lease expiry: Above median for more than 20%

Debt Profile

• Gearing ratio: ± 10% from median
• Cost of debt: Above median for more than 20%
• Fixed rate debt %: ± 10% from median
• Unsecured debt %: 0%
• WADM: Below median for more than 20%
• Highest debt maturity within 5 years: Above median for more than 20%; Falls in 2024
• Interest coverage ratio: Above median for more than 10%

Diversification Profile

• Top geographical contribution: Below median for more than 20%
• Top property contribution: Below median for more than 20%
• Top 5 properties' contribution: Below median for more than 20%
• Top tenant contribution: ± 10% from median
• Top 10 tenants' contribution: Above median for more than 20%

Key Financial Metrics

• Property yield: Above median for more than 20%
• Management fees over distribution: Below median for more than 20%; $9.90 distribution for every dollar paid 
• Distribution on capital: Above median for more than 20%
• Distribution margin: ± 10% from median

Trends

• Uptrend: Distribution Margin
• Flat: DPU, NAV per Unit, Occupancy, Interest Coverage Ratio, Property Yield
• Slight Downtrend: Distribution on Capital

Relative Valuation

• P/NAV: Below average for 1y; Average for 3y
• Dividend Yield: Above average for 1y; Average for 3y

Author's Opinion

Favorable	Less Favorable
Diversified Sector	Low REIT Sponsor's Shareholding
High Directors of REIT Manager's Shareholding	Low REIT Manager's Shareholding
Long WALE	High Cost of Debt
Well Spread Lease Expiry	0% Unsecured Debt
Long Weighted Average Land Lease Expiry	Short WADM
High Interest Coverage Ratio	Concentrated Debt Maturity
Low Top Geographical Contribution	High Top 10 Tenants Contribution
Low Top Property & Top 5 Properties Contributions
High Property Yield
Competitive Management Fees
High Distribution on Capital
Distribution Margin Uptrend

The performance is similar to the previous quarter. The manager has achieved a quick capital recycling of self-storage properties sales into a grocery-anchored property with a small gap of 5 weeks time. Though the pro-forma DPU is expected to be improved, the gearing is also increased to a slightly high level.

You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and Detail of Singapore REIT

REIT Analysis - List of previous REIT analysis posts

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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage due to the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.