On Thursday, BMO (TSX:BMO) Capital Markets maintained its Market Perform rating and $18.00 price target for JBG SMITH Properties (NYSE:JBGS) shares. The firm acknowledged the real estate company's efforts to pivot towards a business model focused on multifamily properties and National Landing office spaces, despite experiencing setbacks such as the pause on Amazon (NASDAQ:AMZN)'s HQ2 and the cancellation of the Monumental Sports deal.
JBG SMITH Properties, which recently held an Investor Day, is progressing with its strategy to transform into a real estate investment trust (REIT) that is primarily concentrated on multifamily units, which are expected to make up 56% of its portfolio, and office spaces in National Landing, accounting for 40%. The company has shown notable leasing achievements, particularly with The Grace and Reva multifamily redevelopments.
The company's office sector is also undergoing positive changes, with JBG SMITH Properties positioning National Landing as a hub for defense and technology industries, while also enhancing the area with unique amenities. BMO Capital Markets notes that the stock is currently priced attractively.
However, BMO Capital Markets suggests that for JBG SMITH Properties to narrow its discount to net asset value (NAV), further earnings growth and progress on the Amazon HQ2 project may be necessary. The company's current initiatives and developments are being closely monitored by investors as indicators of its future financial performance.
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