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Duke Realty Corp DRE

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Strong Leasing Environment Drives Significant Second-Quarter Growth for Duke Realty

Kevin Brown Equity Analyst

Analyst Note

| Kevin Brown |

Second-quarter results were slightly ahead of our expectations for Duke Realty, though we don't currently anticipate any material changes to our $36 fair value estimate for the no-moat company. Same-store occupancy came in at 98.0% in the second quarter, in line with our estimate and a 10-basis point improvement over the first-quarter figure. Cash leasing spreads were a very healthy 19.2%, though we will note that the high number was driven by the company seeing far more renewal leases, which typically see much higher leasing spreads, than new leases in the quarter when the number is usually balanced between the two. Same-store net operating income was up 5.5% in the second quarter, which was ahead of our estimate of 4.5% growth. As a result, core funds from operations came in at $0.44 for the second quarter, 6 cents higher than the $0.38 reported in the second quarter of 2020 and 4 cents higher than our $0.40 estimate for the quarter.

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Company Profile

Business Description

Duke Realty is an Indianapolis-based publicly traded REIT that owns and operates a portfolio of primarily industrial properties and provides real estate services to third-party owners. It has interest in over 150 million square feet across the largest logistics markets in the U.S.

8711 River Crossing Boulevard
Indianapolis, IN, 46240
T +1 317 808-6000
Sector Real Estate
Industry REIT - Industrial
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type Hard Assets
Employees 350

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