Kingston Properties Limited (KPREIT) is set to recognise a US$1.38-million ($221.28 million) write-down on a real estate investment in East Point, Atlanta, Georgia.

“We were informed by Apex Development Group LLC, the manager of Polaris at East Point Partners LLC on September 5, 2025, that the underlying investment property known as Polaris at East Point, in Atlanta, Georgia, was foreclosed by the lender, and it has been determined that the equity interest is lost,” KPREIT stated in a Friday disclosure on the Jamaica Stock Exchange (JSE).

KPREIT invested US$1.62 million in July 2022 as a limited partner in Polaris at East Point Partners LLC, a Delaware LLC, which purchased a 112-unit multi-family property. The property acquisition was valued at US$12.7 million and was funded by a mixture of debt and equity. KPREIT initially owned 45 per cent of Polaris at East Point, but its 2024 annual report revealed that its interest in Polaris at East Point was 39.5 per cent. The audited financials revealed that KPREIT recognised a US$228,207 fair value loss on this investment in 2024.

KPREIT will have to recognise the US$1.38 million write-down on its income statement for the third quarter as per IFRS 13 and IFRS 9. This is due to the Polaris at East Point investment being classified as fair value through profit and loss (FVTPL). However, this investment represented 1.63 per cent of KPREIT’s consolidated asset base, a minimal amount relative to KPREIT’s larger investment property portfolio.

“The Group is actively pursuing strategies to off-set the impact of the FVL and support continued growth in asset value and profitability. KPREIT remains committed to transparency and prudent financial management and will provide further updates as necessary,” KPREIT added.

KPREIT used to have half of its real estate portfolio in the United States in 2017, with most of these assets held in Fort Lauderdale and Miami, Florida. KPREIT subsequently sold these property investments and decided to maintain exposure to the US real market via investment funds. The US represented five per cent of KPREIT’s geographic portfolio in March 2025.

KPREIT invested US$1 million as a limited partner in CGI Fund I during 2020. CGI Fund I is managed by CGI Investment Management LLC and invests in class-A office buildings and mixed-use properties in Miami. KPREIT has received US$78,622 in dividends from this investment, but the fund was marked down by US$400,000 as a fair value loss during 2024. KPREIT’s interest in this fund is 2.1 per cent as per its audited financials.

KPREIT also invested US$1.83 million during July 2021 into Polaris at Camp Creek Partners LLC, a Delaware LLC, which purchased a 155-unit multi-family property in Atlanta, Georgia. The property acquisition was valued at US$15.5 million and was funded with 75 per cent debt and 25 per cent equity. KPREIT owns 38 per cent of this fund, which was valued at US$2.46 million in 2024.

KPREIT is currently expanding its investment property portfolio in Jamaica, the Cayman Islands and United Kingdom. KPREIT purchased its first UK property in December 2024 for US$5.28 million at 2350 Aztec West. KPREIT subsequently purchased an office building in Dorking Business Park, UK on March 31 for US$4.62 million.

KPREIT also executed two sale and leaseback arrangements in Downtown, Kingston for a combined US$6.39 million in mid-2024. KPREIT is currently executing its first greenfield project on Rousseau Road as a joint venture with Relmac Construction. The 14 mini-warehouse units should be complete by the first quarter (January to March) of 2026. KPREIT is also considering the development of a high-tech parking solution in downtown Kingston.

The Cayman Islands currently represents the largest geographic market for KPREIT at 42 per cent followed by Jamaica and the UK at 41 per cent and 12 per cent, respectively.

KPREIT’s second quarter (April to June) report revealed that its rental income grew 35 per cent to US$1.65 million due to the recent Jamaican and UK acquisitions plus rent escalation across several properties. Despite an eight per cent rise in operating expenses to US$486,041, KPREIT’s operating profit grew 55 per cent to US$1.22 million.

Despite a 61 per cent rise in financing costs to US$559,189, KPREIT’s profit before tax (PBT) increased 39 per cent to US$676,308. KPREIT’s net profit grew 34 per cent to US$637,337 ($101.31 million).

For the overall six months, KPREIT’s rental income increased 30 per cent to US$3.03 million with operating profit also rising 22 per cent to US$2.51 million. Due to a 58 per cent increase in finance costs to US$1.10 million, KPREIT’s PBT moved up ten per cent to US$1.57 million. KPREIT’s net profit grew 15 per cent to US$1.64 million.

KPREIT’s asset base increased two per cent over the six months to US$88.84 million with investment properties valued at US$76.94 million and US$847,257 in cash. Total liabilities increased two per cent to US$35.39 million with total debt at US$33.84 million. Shareholder’s equity increased four per cent to US$53.45 million which translates to a book value of US$0.0605 ($9.70).

KPREIT’s stock price closed at $9.60 on Friday which leaves the stock up two per cent in 2025 with a market capitalisation of $8.49 billion. KPREIT paid a US$0.000566 dividend totalling US$500,344 on August 26 to shareholders on record as of August 5.

KPREIT received approval from its shareholders on August 10 to return to the equity markets via an additional public offering. The new equity raise is meant to support KPREIT’s aim to achieve US$100 million in assets under management or ownership and generating US$2 million in funds from operations for the 2026 financial year.