United Hampshire US Real Estate Investment Trust (Reit), through its indirect wholly owned subsidiary UH US Albany 2019, has sold a supermarket property in the US state of New York for US$23.8 million.
However, the net proceeds of US$23.2 million from the divestment is about 10.2 per cent, or US$2.6 million, lower than the book value of the property, which stood at US$25.8 million as at Jun 30, 2024.
Equivalent to an independent valuation as at end-2024, the consideration of US$23.8 million is about 4.2 per cent higher than the purchase price of US$22.9 million, said the Reit’s manager on Friday (Jan 17).
The manager noted that the US$23.2 million net proceeds will be used to repay existing debts, finance capital expenditure, as well as fund potential acquisitions and other general corporate requirements.
Together with the divestment of the Lowe’s and Sam’s Club properties within Hudson Valley Plaza – which were completed in August 2024 – the divestment is expected to lower the Reit’s aggregate leverage ratio to 37.2 per cent, from 41.7 per cent as at end-2023 on a pro forma basis.
The divestments will also improve its adjusted interest coverage ratio to 3.5 times, from 2.9 times as at Dec 31, 2023, on a pro forma basis.
Distribution per unit, however, would be lowered slightly to US$0.0476 from US$0.0479, while net asset value per unit would remain the same at US$0.0074.
The buyer, Agree Development, paid the full amount on Thursday (US time), and the divestment is completed, said the manager.
The property is a freehold grocery store with a net leasable area of 65,000 square feet, located at 709 Central Avenue Albany, Albany County of the state of New York.
