KORE US REIT (CMOU) H1 2025 earnings summary

Executive summary

• Leased 281,230 sq ft (5.9% of portfolio NLA) in H1 2025, with major activity in Bellevue, Redmond, Denver, and Dallas, and positive rental reversion of 0.5% for H1 and 3.3% for Q2 2025.

• Portfolio committed occupancy was 88.2% as of June 30, 2025, down from 90% at end-2024.

• Portfolio comprises 13 office properties in eight US growth markets, valued at approximately US$1.3–1.4 billion.

• No distribution declared for H1 2025, in line with recapitalisation plan announced in February 2024.

• Portfolio remains diversified by geography and industry, with low tenant concentration risk.

Financial highlights

• Gross revenue for H1 2025 was US$74.6 million, up 0.2% year-on-year.

• Net property income (NPI) declined 3.2% year-on-year to US$40.7 million, mainly due to higher repair/maintenance and leasing commission amortization.

• Adjusted NPI (excluding non-cash items) was US$41.4 million, down 4.6% year-on-year.

• Income available for distribution fell 16.2% year-on-year to US$19.9 million, driven by lower adjusted NPI and higher trust expenses.

• Net income dropped 42.5% year-on-year to US$11.7 million.

Outlook and guidance

• Distributions suspended through H2 2025 as part of recapitalisation; may resume in H1 2026 or earlier if market conditions or refinancing improve.

• Expect to end 2025 with occupancy in the mid to high 80% range, despite known vacates.

• Leasing slowdown in H1 2025 expected to be temporary, with recovery anticipated in H2 2025.

• Institutional buyers are returning to the office sector, indicating renewed market interest.

• Portfolio WALE is 3.7 years by CRI, with built-in average annual rental escalation of 2.6%.