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SEGRO premium justified as warehouse boom continues says broker

SEGRO PLC (LON:SGRO) should benefit from the boom in industrial warehouses for some time to come believes broker Liberum.

According to data from CBRE space “under offer” in the first three months of 2021 has reached a new record high and further increases in take-up are expected to come.

Online retailers represented the largest portion of take-up in the period at 50% with vacant ready to occupy space at an all-time low.

SEGRO’s rent collection rates remain high and vacancy remains low, said the broker which has a price target of 1,075p.

“We expect further sector-leading growth for SEGRO in 2021 as record take-up drives rental growth and further progress is made on the significant and highly profitable medium-term development pipeline.”

The 19% premium to assets reflects the near-term outlook, not the longer-term growth prospects, adds the broker.

Shares rose a touch to 1,051p.

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