To The Moon

$IREIT GLOBAL(UD1U.SI)$

Basic Profile & Key Statistics

• Main Sector(s): Office & Retail

• Country(s) with Assets: Germany, Spain & France

• No. of Properties (exclude development/associate/fund): 37

Key Indicators

Performance Highlight

Gross revenue and NPI improved yoy mainly due to contribution from French Portfolio and Parc Cugat which were acquired in 3Q 2021, and also due to step-up rents and CPI indexation. However, income available for distribution has declined yoy mainly due to higher finance costs, 100% management fees payable in cash (vs 50% for 1H FY21), significantly higher administrative costs and other trust expenses, higher tax expenses and straight-line rent adjustment.

Rental Reversion

Rental Reversion is at positive 5.2%.

Distribution Breakdown

• Distributable Income Breakdown:100% from Operation

• Distribution = 90% of Distributable Income

Related Parties Shareholding

• REIT Sponsor's Shareholding: Above median for more than 20%

• REIT Manager's Shareholding: Below median for more than 20%

• Directors of REIT Manager's Shareholding: Above median for more than 10%

Lease Profile

• Occupancy: Below median for more than 5%

• WALE: Above median for more than 10%

• Highest Lease Expiry within 5 Years: Above median for more than 10%; Falls in 2024

• Weighted Average Land Lease Expiry: 100% freehold properties

Debt Profile

• Gearing Ratio: Below median for more than 10%

• Cost of Debt: Below median for more than 20%

• Fixed Rate Debt %: 100%

• Unsecured Debt %: 0%

• WADM: Above median for more than 20%

• Highest Debt Maturity within 5 Years: Above median for more than 20%; Falls in 2026

• Interest Coverage Ratio: Above median for more than 20%

Diversification Profile

• Top Geographical Contribution: Below median for more than 20%

• Top Property Contribution: Above median for more than 20%

• Top 5 Properties' Contribution: Above median for more than 20%

• Top Tenant Contribution: Above median for more than 20%

• Top 10 Tenants' Contribution: Above median for more than 20%

Key Financial Metrics

• Property Yield: ± 10% from median

• Management Fees over Distribution: Below median for more than 10%; $9.01 distribution for every dollar paid 

• Distribution on Capital: ± 10% from median

• Distribution Margin: ± 10% from median

Trends

• Uptrend: NAV per Unit

• Flat: Interest Coverage Ratio

• Downtrend: DPU, Occupancy, Property Yield, Distribution on Capital, Distribution Margin

* DPU and NAV per Unit are in Euro

Relative Valuation

• P/NAV - Below average for 1y; Below -1SD for 3y & 5y

• Dividend Yield - Average for 1y, 3y & 5y

Author's Opinion

The occupancy rate has decreased to 88.3%, primarily because Deutsche Telekom vacated the Darmstadt Campus at the end of November 2022. However, the manager has stated that they are currently in advanced discussions with a few potential tenants. Additionally, the IREIT has hedged all of its borrowing with interest rate swaps and caps, and there is no debt maturity until 2026, which helps to mitigate the impact of rising interest rates.

You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and Detail of Singapore REIT

REIT Review - List of previous REIT analysis posts

*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage due to the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.