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Cross Asset: CPI Property (Baa3/BBB-)

REAL ESTATE
  • CPI makes second disposal in a week, divesting a 50% stake in a Czech hotel portfolio for €173mn gross valuation.
  • Although a small deal, equity up ~7% on the news, cash mixed in a +3/-3 range. Equity appears thinly traded.
  • Proceeds will go to debt repayment. Disposals at reasonable valuations are key here to try and protect the IG rating.
  • The disposal is good for sentiment and demonstrates intent, but after a massive rally since 4Q23 spreads seem disinclined to price in further optimism here.

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