Dexus' sale of Sydney office show office REITs are undervalued - Morningstar

GPT

14/06/2023 23:21

** Morningstar says Dexus'  DXS.AX  sale of its office tower
supports idea co and other major office REITs are undervalued 
    ** Real estate firm on Friday said it will be selling one of
its premium office buildings in Sydney's central business
district at near 17% discount for A$393.1 mln ($267.03 mln)
    ** We don't think Dexus' entire portfolio would trade at a
similar discount - Morningstar
    ** Our outlook is for gradual recovery in office rents as
CBD activity continues to increase on economic and population
growth - Morningstar
    ** Morningstar prefers portfolios of Dexus, Charter Hall
 CHC.AX , GPT  GPT.AX  and Mirvac  MGR.AX  as they have assets 
with leases signed at higher pre-pandemic rents
    ** Five of 11 analysts rate the stock "buy" or higher, four
"hold" and 2 "sell" or lower; their median PT is A$8.9 –
Refinitiv data 
    ** Stock is up 1.5% so far this year, as of last close 
    



($1 = 1.4721 Australian dollars)

 (Reporting by Navya Mittal in Bengaluru)
 ((navya.mittal@thomsonreuters.com))