KRG
Kite Realty Group Trust
Price:  
23.07 
USD
Volume:  
1,209,939
United States | Equity Real Estate Investment Trusts (REITs)

KRG WACC - Weighted Average Cost of Capital

The WACC of Kite Realty Group Trust (KRG) is 7.2%.

The Cost of Equity of Kite Realty Group Trust (KRG) is 7.6%.
The Cost of Debt of Kite Realty Group Trust (KRG) is 6.7%.

RangeSelected
Cost of equity6.3% - 8.9%7.6%
Tax rate0.8% - 1.6%1.2%
Cost of debt4.3% - 9.1%6.7%
WACC5.5% - 8.9%7.2%
WACC

KRG WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.530.71
Additional risk adjustments0.0%0.5%
Cost of equity6.3%8.9%
Tax rate0.8%1.6%
Debt/Equity ratio
0.640.64
Cost of debt4.3%9.1%
After-tax WACC5.5%8.9%
Selected WACC7.2%

KRG's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for KRG:

cost_of_equity (7.60%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.53) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.