PGRE - Mizuho downgrades office REITs Kilroy Paramount Group as WFH drags on

Mizuho Securities USA analyst Omotayo Okusanya downgrades Kilroy Realty (KRC) to Neutral from Buy and Paramount Group (PGRE) to Underperform from Neutral as pressure on leasing activity continues to be particularly challenging in the San Francisco market.Paramount Group slides 1.8% in premarket trading.Upgrades Corporate Office Properties Trust (OFC) to Buy from Neutral as the analyst sees "little change to the strong outlook in defense spending under the Biden administration."Remains Underweight on the view that the office REIT sector's  relative outperformance vs. the broader REIT sector since the Pfizer vaccine news on Nov. 9 is unwarranted. "The pandemic is getting worse, not better, and the roll-out of the vaccine has been slower than expected," Okusanya writes.That increases the risk that work-from-home will become a more permanent option to the office environment.Notes that 2021 outlook "feels like more of the same from 2020," as some employers put out potential return to office

For further details see:

Mizuho downgrades office REITs Kilroy, Paramount Group as WFH drags on