PRET (Issue 62) - Pan-Euro REIT Valuations

Research evidence excerpt

PRET (Issue 62) - Pan-Euro REIT Valuations

rade note (link), along with our assessment of macro

conditions, sector structure and asset-level risks. REITs have performed poorly for 3+ years,

but remain a leading indicator to the £1Trn direct market representing c. one third of UK GDP.

Thinking Outside the (Big) Box #7 The Jefferies EMEA Real Estate team publishes a quarterly

report dedicated to Industrials & Logistics. In this report, we track take-up levels, vacancy

rate & rental movements, reversionary potential, and investment volumes & yield expansions/

compressions for the ten specialists under coverage (ARGAN, Catena, CTP, Montea, Sagax,

SEGRO, SLP, Tritax BB, VGP, WDP).

Cleaner Story, But Still Constrained The distribution of the Norion stake is strategically positive,

simplifying the equity story and sharpening the focus on Balder’s core operations. That said, Jefferies EMEA Real Estate * | Equity

muted earnings growth, weak organic trends, and elevated leverage still limit re-rating scope. Research Team

| jefferiesemearealestate@jefferies.com

Until clearer progress on deleveraging emerges, we believe the case will remain balance sheet-

driven rather than growth-driven. Mike Prew * | Equity Analyst

44 (0) 20 7029 8422 | mprew@jefferies.com

Weak Underlying Trends in Q1 While PFPM guidance was reiterated, the quarter showed clear Pierre-Emmanuel Clouard, CFA ^ | Equity

cracks across all key operating metrics of Sagax, with LfL rental growth almost stalling (+0.5%), Analyst

vacancy rising materially, and negative reversion offsetting indexation tailwinds. The current +33 1 8665 6373 | pclouard@jefferies.com

earning capacity (run-rate PFPM) declined by 3.3% to SEK 4,409m, mainly driven by a ~10% Stephanie Dossmann ^ | Equity Analyst