High Income REIT Q2 2025 update: 15% Dividend, 60% discount - European small cap
Still an accidental high yielder?
Reminder : bought in Q1
Here’s a quick update on ICADE, following the release of its H1 2025 financial results.
As a reminder, I personally own 485 shares of the company, purchased at €20.50, in march 2025 with a very long-term outlook.
I/ Investor experience since purchase in march 2025 : volatility, high yield, huge discount
Two things were certain: volatility and high yield. As always, the classic combination: high yield, high risk. First, let’s look at volatility: the price has fluctuated between 18.50 euros and 24.50 euros since the beginning of the year. Volatility has certainly been a factor. But one thing is clear: the property company’s difficulties are already priced in (see chart below for the stock price on July 25, 2025).
Source: Google finance
The high yield is certainly delivering. Unfortunately, I missed the March dividend as I was only able to purchase a few days after the ex-dividend date, but I did catch the July one.
The discount, still enormous, has narrowed, moving from 66% to 61%. To be precise: Icade's stock traded at a significant discount of approximately 61.31% as of June 30, 2025, based on its closing price of €21.90 against an EPRA NRV per share of €56.6.
15% Yield on a 60% Discount: Icade Q2 2025 Update
Icade remains the textbook definition of an Accidental High-Yielder, trading at a staggering 60% discount to its asset value (EPRA NRV) and offering a projected 15% dividend yield.
Since March 2025, the investor experience has been defined by two certainties: volatility (price fluctuating between €18.50 and €24.50) and the high yield delivery. The central question remains: is the “short-term pain” still worth the “long-term gain”?
In this update, we analyze the stock’s performance and operational execution.
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Disclaimer: This article is for informational and educational purposes only and should not be considered financial or investment advice. The views expressed are solely those of the author and do not constitute a recommendation to buy, sell, or hold any security. Always conduct your own research and consult with a professional before making any investment decisions.
Thank you for your comment, David. You raise several important points.
You're right that the dividend will be lower. I estimate it will be around €3 per share, possibly less if management uses the full flexibility under French tax rules. The exceptional post-disposal dividends are over.
I also see the risks you mentioned:
Interest rates: Are already rising for French mortgages and could increase further.
Political uncertainty: Is likely to persist until at least the 2027 presidential election.
Public finances: Are a structural risk for any investment in French real estate.
Short-term pain is certain, even with the steep NAV discount and the backing of the Caisse des Dépôts et Consignations. Furthermore, I believe the growing "return to office" trend, as unemployment rises and employer leverage increases, should ultimately benefit their well-located office portfolio.
I am looking forward to the next quarterly results. We will know in a few months whether you were right not to get back into the stock. Rendez-vous au Q3!
I haven't looked into this name for a while. Good to see that there should be a good dividend yield going forward. I was under the impression that the high dividend yield was only temporary following the disposal of the health care assets, so thought I had missed my opportunity last year.
Owning office space outside the main CBD has been noted as a risk. Also the current political situation in France and their unsustainable financial situation looks like interest rates could rise even spike in the future. However as you say opportunity comes during times of uncertainty