A significant opportunity lies in the potential for rental reversions as leases approach expiry in 2028, Tee points out. Currently, the average rental rate for DWP-leased properties is GBP12 per sqft, substantially below market averages.
KGI Securities analyst Alyssa Tee has initiated “outperform” on Elite UK REIT with a target price of 37 pence, noting its portfolio resilience.
In her Dec 18 report, Tee highlights the REIT’s robust business model, with 99.1% of gross rental income derived from the UK government. This provides a strong foundation for continued low-risk sovereign-backed cash flow generation. Elite UK REIT derives 93.5% of its gross rental income from the UK’s Department of Work and Pensions (DWP), which leases 136 of its 149 properties.
