KORE US REIT (CMOU) H2 2025 earnings summary

Executive summary

• Early resumption of distributions at $0.25 per unit for 2H 2025, ahead of schedule, following successful refinancing and recapitalization, with plans for progressive increases as portfolio performance improves.

• Portfolio occupancy at 87.2% with 622,029 sq ft of leases signed in 2025, and rental reversion of +6.8% for the year.

• Asset management transition underway due to Pacific Oak's termination; seamless handover expected with the current team moving to a new manager.

• Portfolio remains diversified across U.S. growth markets, with over 390 tenants and significant exposure to tech, medical, and lifestyle sectors.

• The REIT will be renamed KORE US REIT effective 5 February 2026, marking a refreshed chapter post-recapitalisation.

Financial highlights

• FY2025 gross revenue rose 2.5% year-over-year to $150.2 million; net property income increased 3.0% to $80.7 million.

• Adjusted NPI was $83.7 million, up 0.3% year-over-year.

• Income available for distribution was $43.0 million, down 9.6% year-over-year, with distributions resuming in 2H 2025.

• NAV per unit at $0.68; portfolio valuation stable at $1.33 billion, with a net fair value loss of $40.5 million after capex and tenant improvements.

• Finance and other trust expenses increased 6.0% to $33.0 million, mainly due to expiring interest rate swaps and higher professional fees.

Outlook and guidance

• Targeting a steady increase in payout ratio to approximately 80% over several years, aligned with long-term portfolio performance.

• Expecting portfolio occupancy to remain in the mid-80% range by end-2026, despite known vacates such as Meta.

• Capex for 2026 budgeted at $50–51 million, with $9 million for building improvements and the remainder for leasing-related costs.

• Focus on backfilling vacancies and enhancing leasing appeal through spec suite conversions and targeted upgrades.

• Prudent capital management and redeployment of capital from non-core divestments into debt reduction and higher-growth opportunities.