At the same time, with all of UHREIT’s leases being on triple-net basis, Goh believes that this lease structure will limit operational risks to carpark and common area maintenance. “Most leases include built-in rental escalations of 1%–3% per annum for inline tenants and 5–10% every five years for anchor tenants, providing embedded income growth,” says Goh.
From Goh’s perspective, UHREIT benefits from a highly defensive lease profile given that it has a portfolio weighted average lease expiry (WALE) of 8.0 years and a top-10 tenant WALE of 10.6 years based on gross rental income as of March 31.
“As at Dec 31, 2025, lease expiries are well staggered, with only 2.9% and 5.9% of leases due for renewal in FY2026 and FY2027, respectively. Coupled with a consistently strong tenant retention rate of 90% since listing, these metrics provide good earnings visibility and support the resilience of the REIT's income stream,” Goh adds.
At the same time, based on UHREIT’s credit metrics, the Beansprout analyst foresee that UHREIT has adequate financial flexibility to grow the portfolio through inorganic accretive acquisitions.
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As at March 31, aggregate leverage was at 41.4%, leaving around US$70 million of debt headroom and has no refinancing requirement till February 2028. As of 1QFY2026, weighted average debt maturity was 3.2 years.
“Weighted average interest rate declined for the fourth consecutive period to 4.91%. Interest coverage remained healthy at 2.4 times, versus the regulatory minimum of 1.5 times,” Goh says.
As such, Goh is initiating a “buy” recommendation on UHREIT with a target price of 62 US cents, which is derived from the dividend discount model.
“With UHREIT trading at 51 cents, it is implying a FY2026 distribution yield of 8.8% and FY2025 price to book ratio of 0.65 times. This is slightly higher than other listed REIT denominated in US dollars. The peer group is trading at an average FY2025 price to book ratio of 0.82 times,” Goh concludes.
As at 3.15pm, Units in UHREIT are trading flat at 51.5 US cents.
