TSX:REI.UN - Post by User
Post by
KozmoTon May 05, 2021 1:00pm
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Post# 33132846
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Q1-F21: Great Expectations RioCan’s results held up despite continued lockdowns as more tenants took the long view on the rebound. Although the REIT recorded a decline in same property NOI, in our view, the most bullish indicator of future rents was an 8.1% blended leasing spread for new and renewed leases, up from a spread of 3.8% sequentially and 5.6% in the prior year.
In light of our improved outlook on tenant demand, we increase our occupancy assumptions in the short- and medium-term. Our assumptions of net rental rates also increase by 1 – 1.5% per year. As a result, we maintain our buy recommendation and increase our intrinsic value estimate to C$23.50 per unit.
Highlights from our report: - We explain the blended leasing spread and its significance to RioCan’s future outlook.
- We analyze the improving trend of cash collections despite the effect of lockdowns.
- We discuss how select dispositions may increase occupancies in the future."