Progress with portfolio rebalancing is key

Research evidence excerpt

Progress with portfolio rebalancing is key

24 June 2026

Mizuho Securities Equity Research REIT

Price Objective Change

KDX Realty Investment (8972)

Rating: Neutral Price Objective ¥185,000 ¥165,000

Spotlight: REIT performance in line with ACT: Wait for more active asset reshuffling

market average since Jan 2024 (see For KDX Realty Investment to be re-rated, we likely need to see

Figure 1) an acceleration in portfolio rebalancing that improves the profit growth

potential.

Share price (23 Jun) ¥152,100

Implied upside +8% KNOW: Profit growth a bit lacking

TSE Segment TSE We expect rent increases to remain largely the same for office buildings and

rental housing. For retail facilities, rents have been rising recently. We thinkMajor indicators (E = Mizuho estimates)

Market capitalization (¥b) 614.36 internal growth for the portfolio a large will pick up a tad. While the REIT has

Units outstanding (thou.) 4,039.2 been effectively controlling the increase in borrowing costs, the increase hasPotential unit dilution (thou.) –

Daily turnover (thou, mo. avg.) 10.98 been weighing on profits, so we think EPU (excluding property sale gains) will

Foreign ownership (%, 10/25) 29.6 remain flat barring any major change to the scale of the company’s balanceLTV (%, 10/26E) 45.9

EBITDA/Total Asset(%, 10/26E) 4.0 sheet.

BPU(¥, 10/26E) 154,765.0

PBR(x, 10/26E) 1.0 One issue that remains is with selling healthcare assets and other properties

NAV per unit(¥, 10/26E) 190,208 with poor profit growth potential. Amid an increase in interest rates, it is

P/NAV(x, 10/26E) 0.8

ROE(%, 10/26E NP basis) 5.5 becoming more difficult to sell stable properties. We think that a major key for

LTV=Interest bearing debt/total assets a re-rating is progress with portfolio rebalancing for improving profit growth