Broker: DBS Group Research
Date of Report: 30 July 2026
Excerpt from DBS Group Research report.
Report Summary
Stock Focus: AIMS APAC REIT (Ticker: AAREIT SP)
Action: HOLD (Downgrade from BUY)
Target Price: SGD 1.68 (Raised from SGD 1.66)
Last Traded Price: SGD 1.65
Key Insights:
- Valuation-Driven Downgrade: The recommendation is downgraded to HOLD purely on valuation grounds after a strong share price outperformance. There is no deterioration in underlying fundamentals.
- Steady Organic Growth: AAREIT has demonstrated a solid track record in asset enhancement initiatives and accretive acquisitions, contributing to consistent revenue and earnings growth. Several properties offer potential for further redevelopment and income growth.
- Portfolio Strength: Portfolio occupancy increased to 96.1%, with positive rental reversions at 6.5%. Master leases provide stability and include built-in rental escalations. The logistics and warehouse segment continues to show robust rental growth.
- Acquisition Update: The recent acquisition of properties in Perth, Australia is expected to be DPU-accretive and mostly offset the vacancy left by Optus at Macquarie Park, supporting long-term earnings growth.
- Financial Metrics: Forward distribution yield is around 6%, with AAREIT trading at a 30% premium to NAV. The balance sheet remains strong, with aggregate leverage at 24.9% and healthy headroom for future growth.
- Risks: Key risks include lack of new acquisitions and elevated costs that could impede future asset enhancement projects.
Implications:
- Investors should note the HOLD call and slightly raised target price. The REIT’s fundamentals remain strong, but much of the near-term optimism appears priced in.
- Upside catalysts include faster-than-expected backfilling of vacancies and further savings in financing costs if interest rates decline.
Above is an excerpt from a report by DBS Group Research. Clients of DBS Group Research can access the full research report from the broker’s website.
