On November 1, 2023, Kennedy-Wilson Holdings Inc (KW, Financial), a leading global real estate investment company, released its Q3 2023 earnings report. The company reported a GAAP net loss of $92.2 million, compared to a net income of $16.4 million in the same period last year. The company attributed the loss to non-cash mark-to-market adjustments in its fair value portfolio due to high levels of inflation, interest rates at multi-decade highs, and rising geopolitical issues.
Financial Performance
The company's Adjusted EBITDA for Q3 2023 was $33.2 million, a significant decrease from $165.9 million in Q3 2022. This was primarily driven by unrealized fair value declines in its co-investment portfolio. KW's share of recurring property NOI, loan income, and fees totaled $131 million in Q3 2023, slightly up from $130 million in Q3 2022. Realized gains on sale from real estate, net of non-controlling interest, totaled $14 million in Q3 2023, down from $49 million in Q3 2022.
Investment Activity
Kennedy-Wilson Holdings Inc (KW, Financial) made $343 million in gross new investments and $499 million in gross dispositions and loan repayments during the quarter. The company acquired the final tranche of loans totaling $212 million from the previously announced $4.1 billion loan acquisition from Pacific Western Bank.
Balance Sheet and Liquidity
As of September 30, 2023, Kennedy-Wilson Holdings Inc (KW, Financial) had a total of $331 million in cash and cash equivalents and $146 million drawn on its $500 million revolving credit facility. The company's share of debt had a weighted average effective interest rate of 4.3% per annum and a weighted average maturity of 5.4 years.
Outlook
Despite the challenging global investment environment, the company remains optimistic about its future performance. It expects to complete and lease-up several development projects in the near term, including approximately 1,000 multifamily units delivered in Q3 and over 1,300 units expected to complete by the end of Q2 2024.
Explore the complete 8-K earnings release (here) from Kennedy-Wilson Holdings Inc for further details.
