First Berlin Equity Research has published a research update on Grand City Properties S.A. (ISIN: LU0775917882). Analyst Ellis Acklin reiterated his BUY rating and increased the price target from EUR 12.90 to EUR 13.70.

Abstract
Q1 reporting again featured a good operating performance led by 3.4% LFL rental growth, while the rise in financing costs is tailing off. We expect operational momentum to continue with absolutely no sign of Germany’s acute flat shortage improving any time soon. The capital structure has been revamped over the past year by deleveraging measures, increased secured debt, and, most recently, the successful perpetual note exchange offer. The more robust financial profile should help protect the company from any future macro turbulence. We think the seemingly endless negative story of the German property market has about played out, and we expect GCP shares (+13% YTD) to continue to rebound. We remain Buy-rated on GCP with a €13.7 target price (old: €12.9).