OCBC Investment Research Initiates Coverage on OUE REIT

We are pleased to share that OCBC Investment Research has recently initiated coverage on OUE REIT with a 'BUY' call and a fair value (FV) estimate of S$0.340, citing attractive 12-month forward distribution yield of 6.9%.

Key points:

High-quality assets with a balanced sector mix underpins OUE REIT's ability to enhance income resilience through changing market dynamics

- Despite moderated growth in the commercial and hospitality segment, its strategically located assets will enable the REIT to continue absorbing demand ahead of its competitors in a potentially challenging market

Strategic steps taken to restoring restore investors’ confidence and bridge the discount to its net asset value (NAV)

- Rebranding from OUE Commercial REIT to OUE REIT to better reflect its focus on three segments: office, retail and hospitality

- Continued improvement in capital structure, with the proportion of unsecured debt increasing from 30.9% in 2021 to 87.0% as of 30 Sep 2024

- Successful issuance of OUE REIT’s inaugural 7-year investment grade green note in a market where it is rare for non-government-linked companies to issue bonds beyond a five-year tenor

Improving green efforts

- Awarded a four-star rating and 82 points in the 2024 GRESB, up from a three-star rating and 77 points in 2023

#ouereit #reits #singapore #office #hotel #retail #theedge