The research house, which has an overweight recommendation on the sector, said it expects the 10-year MGS yields to remain below 3%.
Affin Hwang's top picks in the sector are Axis REIT and KLCC with target prices of RM1.97 and RM8.13 respectively.
Over the long run, a lower OPR should also lower the finance costs of MREITs and lift earnings although Affin Hwang expects the impact on near-term profit to be minimal.
For 2020, the 25bps OPR rate cut is expected to have a muted impact of under 1% of the MREITs' earnings, it said.
It said most of the MREITs under its coverage, including Axis REIT, IGB REIT, KLCC Stapled Group and YTL REIT have over 70% of their borrowings pegged at a fixed rate.
Other REITs under its coverage including Pavilion REIT and Sunway REIT have fixed rates for 43% of their borrowings.
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