+ Stable. 1H21 NPI and DPU were in line, at 49.6%/51.7% of our FY21e estimates. Gross revenue and NPI increased 31.6% and 23.4% YoY following its acquisition of a remaining 60% interest in the Spanish portfolio on 22 October 2020. Property expenses jumped as its Spanish properties are multi-let and have lower NPI yields. DPU fell 21.4% YoY from an enlarged unit base following IREIT’s rights issue on 18 September 2020 There were no requests for rental rebates or deferrals from tenants in 1H21 – a good sign.
+ Higher valuations. Portfolio valuation was raised by 3.9% HoH, led by a 7% HoH increase for IREIT’s largest property, Berlin campus. Apart from lower discount and capitalisation rates applied across its portfolio, Deutsche Rentenversicherung Bund, its major tenant at the Berlin campus, did not exercise its break option in June 2021 to return part of its leased space to IREIT in 2022. As a result, its entire lease will now only expire in June 2024, raising Berlin campus’ income visibility. This bumped up the property’s valuation.