IREIT Global - RHB Invest 2024-07-11: Near-term Challenges, But Largely Priced In; BUY

• IREIT Global (SGX:UD1U)’s recent announcement of a key tenant vacating does not come as a surprise – this risk was well highlighted earlier. The exit timing does coincide with a challenging macro and funding environment, which has resulted in share price pressure.
• - Read this at SGinvestors.io -

Redevelopment of the Berlin Campus

• Berlin Campus to be repositioned as mixed-use urban precinct post exit of the property’ main tenant – Deutsche Rentenversicherung Bund (DRV) – upon its lease expiry at end Dec 2024.
  • - Read this at SGinvestors.io -
  • DRV will also pay a lump-sum of EUR15.5m in dilapidation costs, equivalent to 16 months of current rent, part of which IREIT Global plans to use for income top-up.
• Considering the asset’s prime location, the current plan is to convert it into a mixed-use facility comprising office (~65-70% of the total or ~50,000sq m), two hotels (~25% of the total), and retail spaces.
• IREIT Global is in active talks with leading hotel and long-stay hospitality operators to potentially master lease this space and de-risk income volatility.

Sponsor/co-investor partnership funding likely.

• Read more at SGinvestors.io.

Singapore Research RHB Securities Research | https://www.rhbgroup.com/ 2024-07-11 SGinvestors.io

---