PhillipCapital analyst Tan Jie Hui has maintained her “accumulate” recommendation on iREIT Global, with its 1QFY2021 results “likely in line” as it reported stable portfolio occupancy of 95.9% for the quarter ended March.

Despite lockdowns in Germany and Spain, the impact of Covid-19 on the REIT’s portfolio was limited, says Tan. No rent rebates or deferrals were provided. All of the REIT’s tenants paid their rents in the 1QFY2021, she adds.

With the acquisition of 27 properties from Decathlon in France, iREIT’s assets under management (AUM) is expected to grow by 15.8% to EUR833.5 million ($1.35 billion). The acquisition is expected to reduce iREIT’s reliance on Germany, with the French portfolio expected to contribute 16% to portfolio gross rental income (GRI).


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On the acquisition, Tan also believes that iREIT will “be also able to benefit from strategic partner Tikehau Capital’s market presence and expertise in the French real-estate market”.

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However, Tan has lowered her distribution per unit (DPU) estimate for the FY2021 by 7% to factor in the EUR79 million equity funding in the form of 212 million new units at 59.6 cents a share and EUR51.4 million of new debt after the acquisition.

On this, she has reduced her target price on the REIT to 68 cents from 70 cents previously.


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“[The] current price implies dividend yields of 7% and total prospective returns of 14.1%,” she writes in a May 17 report.

Units in iREIT closed flat at 64 cents on May 19, or 0.9 times P/NAV, according to PhillipCapital's estimates.