Cromwell European REIT was listed in Singapore in 2017 at a share price of EUR0.55 per unit. That’s a EUR866 million market cap.
Back then, this Singapore REIT had over 70% of its portfolio in European offices, mainly in Germany and the Netherlands.
In December 2024, Cromwell European REIT went through an M&A deal that rebranded itself to Stoneweg European REIT. By June 2025, it converted into a stapled trust.
This move bypassed certain REIT laws and gave Stoneweg flexibility to invest not just in real estate but also in related activities like development. Essentially, the structure increased flexibility for the company.
Thus, the name was changed again to Stoneweg Europe Stapled Trust.
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Today at EUR1.57 per unit, Stoneweg’s Europe Stapled Trust valuations trade at a cheap ~0.78x price to NAV and ~9% dividend yield.
This is what you need to know about Stoneweg Europe Stapled Trust high dividend yield.
Background: What is Stoneweg Europe Stapled Trust?
At EUR827 million, Stoneweg’s assets under management is ~EUR2.25 billion. It’s mainly located across Western Europe and the Nordics, with 65% of its properties now focused in the Netherlands, France and Italy.
It’s also evolved to be more heavily weighted in the logistics/ light industrial and office space, with these two types making up 93% of Stoneweg’s portfolio.
Stoneweg Europe Stapled Trust’s latest financial results
How did Stoneweg perform in the last quarter?
- Gross revenue increased 1.1% y/y to EUR107 million for 1H2025
- Net property income rose 2.2% to EUR67 million over the same time period
- Interest expenses rose by a hefty ~24% to EUR20 million
- Distributions per cents declined by 7% to 6.535 cents
Not too bad. During its latest financial results, Stroneweg’s higher gross revenue and net property income came from higher income from two properties based in Italy after redevelopments were completed.
On top of that, Stoneweg was able to recover some rent from tenants who were likely to default on payments.
What’s more, the higher interest expenses came from the current interest rate environment and greater borrowings. However, this was slightly offset by Stoneweg’s floating rate borrowings that have benefitted from interest rates gradually coming down.
Stoneweg’s average occupancy rates stood at ~92%, which has improved from the previous year. Meanwhile, its Italy property portfolio has the highest occupancy rate of 98.4%. That’s good because Italy is Stoneweg’s third largest market.
In fact, its rental rose strongly during 1H2025:
- 8.1% for the logistics/ light industrial portfolio
- 13.6% for the office portfolio
Now, the Europe Logistics Prime Rental Index has registered a 3.6% increase, supporting rental reversions. Good for Stoneweg’s logistics portfolio.
The thing is, Stoneweg’s two key portfolio segments are logistics/ light industrial and office spaces. Its weighted average lease expiry (WALE) is about five years. This shows Stoneweg can enjoy lock-in rental rates for a longer period.
According to CBRE, demand for European logistics real estate is above pre-pandemic levels. Supply is also growing, but at a decreasing rate. The reduced new supply and higher demand will support occupancy rates in the near future.
Stoneweg’s potential growth opportunity
Here’s one thing I like about Stoneweg: it’s expanding into data centres. Today, Stoneweg has ~5% of its portfolio in data centres.
It invested in these data centres through a EUR50 million investment in a fund called AiOnX, which is a fund by Stoneweg’s sponsor designed for data centre development. Stoneweg will have a minority stake in the fund with a ~6.7% ownership.
The fund gives Stoneweg exposure to five early-stage data centre development sites located in Ireland, Spain, Italy, Denmark and the UK.
The reason behind this investment is clear:
- It gives exposure to one of the fastest growing real estate property types in the industry
- There is synergy with Stoneweg’s geographic location
- Stoneweg will be able to diversify beyond logistics and light industrial real estate property types
In fact, Stoneweg’s investment was quickly revalued up by 50%, recording a EUR24.8 million gains (as at June 2025), which totalled almost EUR75 million.
Whether AiOnX can realize these values remains uncertain. Still, this move highlights Stoneweg’s growth potential.
Here’s the other thing: Demand for data centres is soaring with AI, cloud and data reliance. Yet, supply is constrained by energy limits and regulation. Both of which force governments to regulate and control the supply of data centres.
This creates a strong tailwind for data centre occupancies and rental adjustments. Furthermore, the global AI market is expected to grow at a CAGR of ~37%, driven by machine learning, autonomous systems and neural networks.
Even with the increased demand, supply is not that easy to increase.
My final thoughts
At 0.78x P/B ratio and 9% dividend yield, Stoneweg Europe Stapled Trust is trading cheaply. While its assets show resilience against macro conditions, Stoneweg’s portfolio still commands a healthy occupancy rate.
Having said that, higher borrowing costs have hit Stoneweg’s DPU over the past few years.
Its data centres have been a big driver of potential growth, especially with the challenge of meeting soaring data centre demand. This should bode well for Stoneweg’s long-term growth potential.
For now, data centres make up~5% of Stoneweg’s portfolio, but that could change in the future – with this first investment in the AiOnX fund.
