Edison issues initiation on Regional REIT

RNS Number : 6828F

Regional REIT Limited

29 July 2016

 

London, UK, 29 July 2016

Edison issues initiation on Regional REIT (RGL)

Regional REIT (RGL) provides a focused exposure to UK regional commercial real estate, predominantly secondary assets. The regional property recovery began later than in London and we believe RGL offers the potential for above average late-cycle income and capital growth. It has an established and diversified high-yielding portfolio that already supports the attractive 8.1% prospective yield. RGL's focus on underexploited properties provides additional internally driven potential from asset management initiatives, with potential for accretive asset growth. Brexit has raised uncertainty about the pace of UK economic growth, investor appetite and future occupier demand, but particularly for City of London offices, while sterling's devaluation may provide a boost to regionally focused industry. Meanwhile, interest rates show no sign of increasing.

RGL's prospective dividend yield of 8.1% is the highest among UK REIT sector constituents and it is also fully covered. As we show in the financial section on page 11, we believe there is scope for accretive acquisition activity to further increase DPS above our forecasts. The shares are at a c 13% discount to our 2016e EPRA NAV, which assumes no valuation yield tightening.

Click here to view the full report

All reports published by Edison are available to download free of charge from its website: www.edisoninvestmentresearch.com

About Edison: Edison is an international equity research firm with a team of over 110 analysts, investment and roadshow professionals and works with both large and smaller capitalised companies, blue chip institutional investors, wealth managers, private equity and corporate finance houses to support their capital markets activity. Edison provides services to more than 420 retained corporate and investor clients from offices in London, New York, Frankfurt, Sydney and Wellington. Edison is authorised and regulated by the Financial Conduct Authority.

Edison is not an adviser or broker-dealer and does not provide investment advice. Edison's reports are not solicitations to buy or sell any securities.

Contact details: Learn more at www.edisongroup.com and connect with Edison on: 

LinkedIn	www.linkedin.com/company/edison-investment-research
Twitter	www.twitter.com/Edison_Inv_Res
YouTube	www.youtube.com/edisonitv
Google+	https://plus.google.com/105425025202328783163/posts

 

END

 

 

NRAPGUWPMUPQGUB