2023-05-01 04:48:12 ET
Summary
- SRRTF is a grocery-anchored REIT with a portfolio occupied by diverse and financially sound tenants, which operate in defensive segments of retail.
- In the past 3 years, SRRTF has outperformed REIT benchmarks and closest peers, but on a YTD basis, there is a sudden and negative divergence in price levels.
- SRRTF is punished by the market due to small-cap factor and relatively debt-saturated balance sheet. As of now, SRRTF trades at a ~35% discount to its peers with a dividend of 8.8%.
- However, most of the negative effects from surging interest costs have been already absorbed during 2022, which creates a much more favourable ground to deliver growth.
- Near-term lease renewals in conjunction with strong lease spreads and rent escalators will allow SRRTF to maintain the historical growth momentum and narrow the valuation discount.
For further details see:
Slate Grocery REIT: Market Is Missing The Growth Potential