United Hampshire US REIT - UOB Kay Hian 2024-02-26: Resilient & Attractive Yield From Strip Centres With Long WALE

• United Hampshire US REIT’s Strip Centres in suburban locations have outperformed other asset classes due to entrenched hybrid work arrangements. They cater to necessity spending and have a long WALE of 7.1 years.
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• United Hampshire US REIT provides a resilient and attractive 2024 distribution yield of 10.2% and trades at P/NAV of 0.62x. Maintain BUY. Target price: US$0.68.

United Hampshire US REIT's 2H23 results

• United Hampshire US REIT (SGX:ODBU) reported DPU of US$0.0214 for 2H23 (-27.9% y-o-y), which is slightly above our forecast. The decline was caused by:
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  2. United Hampshire US REIT retaining US$1.3m with payout ratio at 90.6% for 2H23.

Growing organically.

• Gross revenue and NPI grew 1.5% and 1.7% y-o-y respectively for 2H23 due to organic growth from its existing properties through new leases and rental escalation.
• The new Academy Sports + Outdoors store at St Lucie West commenced operations in Nov 23, ahead of the peak year-end festive shopping season.

Resiliency from long WALE.

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Jonathan KOH CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-02-26 SGinvestors.io

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