Gross revenue for the quarter came in at US$43.3 million ($60.1 million), 33.2% higher than US$32.5 million a year ago, largely primarily to revenue contributions from Centerpointe acquired in May and Penn and Phipps properties for the entire 2Q19.
Property operating expenses increased 32.2% to US$16.1 million from US$12.1 million the preceding year, due to an enlarged portfolio.
Consequently, net property income rose 33.8% to US$27.3 million, from US$20.4 million the previous year.
Finance expenses for 2Q19 rose 65.2% to US$6.2 million, largely due to additional borrowings incurred to partially finance the acquisitions of Centerpointe, Penn and Phipps properties. Other trust expenses of US$0.8 million was also 24.8% higher compared to the same quarter last year due to additional audit and tax compliance costs incurred related to acquisitions.
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A tax income of US$68,000 was recognised in 2Q19 compared to a tax expense of US$6.1 million in 2Q18, due to the reversal of deferred tax expenses resulting from
the recognition of unrealised fair value loss on investment properties, partly offset by higher deferred tax expense from tax depreciation of investment properties, as well as higher current taxes on Barbados entities resulting from the increase in corporate tax rates in Barbados effective 1 January.
Net income for the period fell 84.6% to US$2.9 million, due to the net fair value loss on investment properties resulting from the capital expenditures and leasing costs increasing more than the increase in appraised fair values.
Distributable income rose 25% to US$20.6 million, largely due to higher net property income, partly offset by higher finance expenses and other trust expenses.
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As at end June, committed occupancy stood at 97.2%, with a weighted average lease expiry of 6.2 years by net lettable area (NLA).
As at June 30, the REIT had a net asset value (NAV) per unit of US$0.79, with gross borrowings of US$723.1 million.
In its outlook statement, the manager says that it continues to be focused on asset, lease and capital management, in addition to its commitment to sustaining and enhancing environmental, social and governance (ESG) initiatives, and will be selectively seeking investment opportunities that deliver long term value to Unitholders.
Units at Manulife US REIT closed one cent higher at 88 US cents on Tuesday, prior to the release of results.
