NuWays AG Recommends DEMIRE AG as a Buy Despite Challenges

NuWays AG has classified DEMIRE AG with a "Buy" recommendation, setting a target price of EUR 0.80 within 12 months. Despite challenging vacancies, DEMIRE’s Q1'26 results aligned with expectations. Rental income fell 17.3% year-over-year to € 11.6m, affected by asset disposals and increased vacancies. Contractual rents decreased to € 45.7m due to two fully vacant properties and asset sales.

The EPRA vacancy rate rose to 21.0%, reflecting the tough German office market. Letting volumes were modest at around 2,700 sqm. Despite this, DEMIRE management remains optimistic about larger leases in the coming months. The weighted average lease term improved to 5.2 years, aided by restructured rental agreements.

Forecasts for FY26 were maintained, predicting rental income between € 41.5-43.5m and FFO I of € -1.0-1.0m, though NuWays views this as conservative. The report suggests DEMIRE remains an attractive opportunity, trading at a discount to NAV.