Kennedy Wilson reported third‑quarter 2025 results that narrowed its GAAP net loss to $21.2 million from a $77.4 million loss a year earlier, while adjusted net income turned positive at $18.0 million and adjusted EBITDA rose to $125.2 million, an 88% increase from $66.4 million in Q3 2024. The company’s revenue for the quarter was $116.4 million, down 9% from $127.5 million in the same period last year, reflecting a modest decline in rental income that was partially offset by higher fee‑bearing capital.
The revenue decline was driven by a 4% drop in rental‑related earnings, while the fee‑bearing capital segment grew to $9.7 billion, supporting the company’s shift toward a more capital‑light model. Adjusted metrics improved because the firm disciplined operating costs and leveraged stronger cash generation from core rental and credit activities, allowing it to offset the revenue shortfall.
Capital recycling has been a key driver of the company’s financial health. Kennedy Wilson generated roughly $470 million in cash from asset sales in 2025, exceeding its $400 million target. The proceeds were used to pay down unsecured debt and to retire €300 million of KWE bonds, strengthening the balance sheet and freeing capital for higher‑return investment‑management opportunities.
CEO William McMorrow highlighted the progress of the disposition plan and the pending acquisition of Toll Brothers’ Apartment Living platform, which is expected to add $5 billion in assets under management and expand the rental‑housing portfolio to over 60,000 units. He noted that the company’s fee‑bearing capital growth and the capital‑recycling program are central to its strategy of moving toward a more profitable, asset‑light model.
The market’s strong reaction to the earnings was largely driven by an unsolicited take‑private offer from a consortium led by McMorrow and Fairfax Financial, which proposed to acquire all outstanding shares at $10.25 per share—a premium of about 38% over the closing price on November 3. The offer, which is not subject to financing, provided an immediate upside for shareholders and dominated investor focus, while the earnings results themselves were viewed as a positive sign of operational improvement but not the primary catalyst for the market move.
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