Árima Real Estate SOCIMI, S.A. (ARM.MC) fair value

ACCE thesis

Árima Real Estate SOCIMI owns and manages a portfolio of Spanish office buildings, leasing space under long-term contracts to tenants in Madrid and other Spanish cities, and it is structured as a SOCIMI, the Spanish listed REIT regime that requires it to distribute most of its earnings. Revenue grew 7.3% and operating margins sit at 70.2%, so the rental book converts to profit efficiently, though a 6.7% ROE shows how little equity is working in the business. The trailing P/E of 9.0 against a forward P/E of 17.5 implies earnings are expected to fall or be less certain over the coming year, so the question for the portfolio manager is whether the trailing figure reflects a one-off or a durable decline. At a 279M EUR market cap and no index membership, the stock is small and thinly followed, which can create mispricing but also limits liquidity. The thesis needs a closer look at lease expiries, occupancy and the reconciliation between trailing and forward earnings before the name merits further work.