Segro: Framing the growth opportunity

Research evidence excerpt

Segro: Framing the growth opportunity

e recovery of property values. Demand for industrial/logistics properties could further decline,

increasing market vacancy. Returns across Segro’s Data Centre pipeline below our expectations. Portfolio expansion via new

property development carries inherent risk, as does growing into brownfield development opportunities/data centres, while

enhanced competition, high costs and limited availability of zoned land could impact on such plans. Segro has a high proportion of

third-party logistics and post/parcel delivery tenants within its portfolio which are relatively low-margin businesses, which could

impact Segro’s ability to capture embedded rent reversion.

RATINGS DEFINITIONS, BENCHMARKS AND DISTRIBUTION

EQUITY RATINGS DEFINITIONS

Bernstein brand

The Bernstein brand rates stocks based on forecasts of relative performance for the next 12 months versus the S&P 500 for

stocks listed on the U.S. and Canadian exchanges, versus the Bloomberg Europe Developed Markets Large and Mid Cap Price

Return Index EUR (EDME) for stocks listed on the European exchanges and emerging markets exchanges outside of the Asia

Pacific region, versus the Bloomberg Japan Large and Mid Cap Price Return Index USD (JPL) for stocks listed on the Japanese

exchanges, and versus the Bloomberg Asia ex-Japan Large and Mid Cap Price Return Index (ASIAX) for stocks listed on the Asian

(ex-Japan) exchanges -unless otherwise specified.

The Bernstein brand has three categories of ratings:

• Outperform: Stock will outpace the market index by more than 15 pp

• Market-Perform: Stock will perform in line with the market index to within +/-15 pp

• Underperform: Stock will trail the performance of the market index by more than 15 pp

PROPERTY/REAL ESTATE 4