In this briefing:
1. Daiwa House REIT Placement – Well-Flagged but Barely Accretive to DPU
Daiwa House Reit Investment (8984 JP) (DHR) is raising about US$329m in its placement to fund the acquisition of properties.
The deal scores well on our framework owing to strong price and earnings momentum. The assets to be acquired are a good mix of logistics, retail, and hotel.
However, the properties to be acquired mostly have an NOI yield lower than the average NOI yield of DHR’s existing assets in the respective asset classes. Despite increasing the portfolio value by almost 10%, the ten properties are only expected to be 1.37% accretive to DPU.
That said, DHR’s acquisition has been well-flagged as it was highlighted in its September presentation.
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