High Financial LeverageA debt-to-equity ratio of 2.25 indicates significant leverage that raises interest and refinancing risk. Over the medium term high leverage constrains capital allocation, magnifies earnings volatility and can force asset sales or equity raises if cash flows weaken or rates rise, limiting strategic flexibility.
Negative Net ProfitabilityPersistent net losses erode book equity and limit retained earnings, undermining the REIT's capacity to pay distributions or self-fund development. If losses persist, management may need to change strategy, sell assets or seek external capital, altering long-term returns and balance sheet stability.
Declining Operating MarginsFalling EBIT/EBITDA margins point to worsening operational efficiency or weakening pricing power. Over several quarters this reduces the cushion available to cover financing costs and fund development, pressuring free cash flow and making long-term value creation more difficult without cost or revenue fixes.