BUZZ-BMO cuts PT on office REITs amid AI‑driven demand risks

Reuters03-25 20:18
BUZZ-BMO cuts PT on office REITs amid AI‑driven demand risks

** BMO trims price targets across several office REITs, citing continued valuation pressure, constrained capital markets, and persistent downside risks tied to refinancing and longer-term demand uncertainty

** Brokerage says office demand, already strained by work-from-home, faces a larger structural risk from AI that could sharply reduce white-collar employment

** Adds that the sector has not fully recovered from COVID-era utilization declines, compounding long-term demand concerns

** Says discounted valuations limit access to external growth and increase earnings and valuation volatility

Companies

New PT

Old PT

Kilroy Realty

$34

$44

BXP

$68

$82

Vornado Realty

$33

$42

SL Green Realty

$55

$60

(Reporting by Apratim Sarkar in Bengaluru)

((Apratim.Sarkar@thomsonreuters.com))

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