In an April 7 note, Natarajan is banking on a German real estate recovery, keeping “buy” on IREIT with a 34-cent target price. The target price includes a 2% ESG premium, based on RHB’s proprietary methodology.
IREIT Global’s key German market — where around 60% of its portfolio is located — is starting to show signs of economic recovery from the new government’s massive fiscal stimulus package, which should stimulate demand for office property, says RHB Bank Singapore analyst Vijay Natarajan.
This is positive for IREIT’s planned Berlin Campus redevelopment, which is “gaining good traction”, says Natarajan. “IREIT could divest a partial stake in the project to reduce funding requirements and unlock value. IREIT remains a potential privatisation candidate with a sharp dislocation in its trading price, at a 60% discount to book value.”
