Cory Diary : Turnaround of Reits

With the current high rate and coming Fed meeting announcement soon when will it be a good time for Reits turnaround in stock price ? Looking at the Rate (below chart ) which max spike in Aug 2023 and probably well felt by end of 2022, when will rental reversion be able to catch up assuming no more rate increase ?

If we are to take Mall Reit example assuming 3 years cycle of contract, full update maybe Aug of 2026. There are variables on reit types, management ability and probably loan cost which varied with their own renew or expiry. There is no definite answer we can know unless we are insiders.

To be safe, I would think early next year 2025 will be a good timeframe to review Reits allocation increase. Anything before will need good conviction, sizing and unique Reits performance.

Will rate cut helps ? Maybe shorten the wait accordingly. This could be a slow process of unwinding. So may not help much near term.

Cory Diary

2024-06-10

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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Not responsible of errors. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.

Cory Diary : Why is Reits affected by Interest Rate

Often we hear analysts or in forum the perception that Increasing Interest Rate will affects the cost of Reits Loans therefore profitability. However the correlations on table below tells a different story that Reits do generally well in high rate environments .  Hope this settle once and for all, the myth or maybe there is deeper issues within.

Interest Rate Impacts

A well managed Reits will pass the cost to tenant. A too drastic increase within a short period do affect Reits short term as majority of tenancy agreements are still in force but that's not the argument here. Some Reits have build-in rental escalation tied to sales and inflation. Nevertheless, cost is able to pass down to tenant mitigating the impact.

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Yield Compression

What we know is that when investing in Reits, we looks for yield therefore it is logical that we compared it to other products to decide is it worth the risk or seek better returns. In the scenario movement of Interest Rate upwards, it can cause Yield compression. This make us less willing to invest in Reits unless the yield improves further therefore lowering the stock price.

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Competition Examples

Singapore Saving Bond (SSB ) gives 1.5% annualized (each year) for 10 years. Say the rate doubled to 3% and this allows SSB to give higher rate say 2%. Some people who invest in a Reit logically will switch to SSB considering it is basically riskless to capital. Reit price will naturally falls as there will be more sellers.

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In situation of no good alternative, REITs price will generally rises with strong economic and stability as investors are willing to take larger risk. Another comparison though not necessary guaranteed is CPF giving 2.5% and 4% to CPF OA and CPF SA respectively. Though riskless, there are limitations and restrictions.

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Not all Reits are the same. Some Reits risks are insane. Be careful of Yield Traps and Pitfalls. However, if a Strong Reit is unfairly sold down, remember to "Koi Durians" ! This differentiate Veterans from the Green as Fundamentally, the business unchanged.

.

If you are interested to know more about Reits. Try this books !

Making your Millions in Reit

Passive Income from Singapore Reits

Singapore REITs as An Asset Class

Playing the REITs Game

You could be well on the journey to Financial Freedom like me. But please DYODD.

Cory

2021-0725

Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.

Cory Diary : Why Dividend Investing is so "Exciting"

Remember in my younger days, RM will furnish us with the idea that investment  today, 10 years later sure Huat with annual 10% based on past 10 years track record. And they will show you the charts on why so. What they didn't tell you is not in the contract is not guaranteed and  the other is that they won't be around few years later to service you or you are't around anymore to bother (touch-wood). The key is don't sell in short term. Probably high sales charge or they will still be around and need to answer to you. lol

Fast forward today. Is there anyone really can guarantee good returns after 10 years ? If so, Banks wouldn't need to sell to us. They will be happy to do it themselves.  I am sure institutions will be happy to invest too. Why bother to grow an army of RMs to service thousands of retailers. 

With Reits that is strong and growing, DPU management has become an expected norm. This will last as long interest rates are low or to be better said, borrowing cost is low relative to earning. Hence the term we hear about Income Ratio (ICR).  It has become a performance metric to drive managers too. That's not easy in execution. 


Why Maintain or Growing DPU is so important ?

So when someone tells me DPU YoY only up 1%, I am smiling till my teeth drop already. Why ? Ascendas Reit has run up significantly for a number of years. This year "just" 23% YTD excluding dividend. See chart below of Ascendas Reit with Dividend Effects !

To grow DPU or maintain for 10 years are not that difficult to find nowadays as long we have Good and Credible Managers however this is not given though. The thing to overcome is Price Anchoring. Will we pay for something that is 23% more expensive from a year ago  ?

Seriously, if I have spare money, I would. Reason being Retailers ask is, "Show me the Money - Sustain-ably". The logic is quite simple. Think of the investment as long term. DPU maintain or increase. This is better than bond already. The cash flow generated covers living expenses. If there is reduction in stock price, we need to look at it in context. Is there fundamental change in the business ?

Next, Trump announced Preliminary Phase 1 deal. Probably due to Biden presidential bid took a hit. The Chinese probably feels a little shaken from it. However, this is far from a complete deals. I doubt it will ever till Trump gets re-elected. What this mean is interest rate will remains low for foreseeable future.

So someone asked. Can I buy MCT today ? Very hard to answer. 7 years of dividends from this year stock price increase. One thing I feel that is never late to invest. Break up our purchases just to be vested some and then see whether we need to average down or up much later. Maybe choose other Reits ( lol ). Don't fall into yield traps. Not all Reits the same. Who knows MCT share price can take another 7 years of dividends leap again. Realistically, the key is how low a yield we are willingly to accept. SSB is like 1.7% range for 10 years. Your take ?

Cory

2019-1012

Cory Diary : Reits Investment Logics

When Recession comes, most investments will be affected. This applies to Correction as well.
Interestingly, this are one of the best time to buy. The question is what stock to buy and will we buy ?

In the last recession, Reit stocks price like many other non-reit investments are badly hit. STI Index reflects the poor situation too. If we are to use today thinking, and understand how the mechanics of how Reits work, one would wonder how can things can go so bad in stock prices.

Basically, Cash or the lack of it as everyone "Hides" them when is one of the best time to invest. Many is taught about the gearing lesson and the dilution of it. Buying during this period do goes against Human Nature of trying to run away from the problem. Trying to do the opposite differentiates the man from the boys. Cory froze in Year 2008. Not that bad. :)

In 2008, many stock prices cut into half easily. Will this happen in next recession ? Never say never. However, with ample liquidity today. And better understanding by investment communities on Reits. Chances are we won't be able to see such deep cut for the next ... next ... (never mind... Cory no crystal ball). There will always be exceptions.

In essence, the DPU of Reits or in another relative term with current price such as yield, say 5% as an example provides the cash flow to one financials as dividend. Multiply it with say 5 year periods will be 25%. That's a recession depth. To be more precise, there are compounded effect and the gearing component especially on properties. And the growth factor which cannot be ignored as it can double dividend gains over the 5 years period too if we pick our stock carefully, and safely to optimize our chance.  


Recession Survival Recipe

1. Able to Survive : Gearing, Loans, Occupancy, 
2. Able to perform "V-Shape" Recovery preferred in stock price : Stock Price
3. Continue to profit from the business during this bad days : DPU
4. Strong Sponsor

Not all Reits the same. Cory want to avoid bad surprises and knives cut. The Gem in Reits are not the Yield but the Growth and Stability that it can perform. Yield is the extras.


Cory
2019-1011

Cory Diary : CapitaMall Trust and WestGate

Manage to sit down and do a quick read on the circular regarding the acquisition of Westgate. It has been a long while holding to an investment report physically. I think CMT have done well in providing good investment knowledge on this.

One of the key variables provided is the gearing dependency on Debt funding ranging at 70%, 85% and 100%. Gearing shifts from 31.5% to 34%, 35% and 36% respectively. What is more interesting is the DPU gains which increase from 11.16 cents to 11.18, 11.25 and 11.33. The most will be 1.5% increase in DPU. Another to know is the interest rate used to compute the above is 3.25% for the additional debts. For a 3.5% it will be about 0.2% impact to DPU.

The main impact is the gearing if is total debt funded. I would think they may maximize private placement amount first to mitigate gearing to the point where DPU gains from existing operations do not cause reduction in dpu level to be not accretive. The other possibility is that valuation up largely from existing property which could help mitigate the gearing space.

Interesting item I found is that the agreed value is much lower than other properties nearby even though the yield is only 4.4%. The key is the strategicness of the asset long term. The other positive is the portfolio overall improvement which is where CMT strength is. A similar learning could be FLT. If FLT emerges better, why wouldn't CMT which has even more stable income and stronger sponsor ?

We could see more exciting future for shareholders.

Cory

2018-1003

Cory Diary : Recent Trade Actions 20180130

2018 January is I feel a more memorable day for my portfolio other than in the black. Is the first time I have a proper clean up state of my Reit counters that is much better balanced to form a better core. Few things I did. Sold AGT moons ago. Sold SPH Reit some time back. And today, sold remaining lots of LMIR as well. Bought back Ascendas Reit and Ascendas HT.


LMIR

The more I learn about LMIR the more I am a little worried. The perpetual shares it has issued is a relatively huge burden. This obscure the gearing which I do not like at all. It would be much better if they are able to get private placement. Then the recent rating downgrade warning kind of sink in. With the current yield of more than 8%, they would need to find some way to raise money ( probably expensively ) this year or to further their acquisition. This is a red flag to me. Since I have achieved 15% returns since 2017 on this counter, is time to say good bye. I do love the yield. Sad.


SPH Reit

Negative revision is the outlook. It may get better but i do not like the few properties or the play on seletar mall to keep the price up. If the stock market is to turn, this won't be my core holding. The yield around 5% doesn't look so good despite the low gearing not gearing up.


Ascendas Hospitality Reit Trust

The plan to sell the two hotels look good considering the impact to dividend is minimal but the value unlocked is more than 10% of it's Nav. Furthermore, FHT results may have help my confidence a little.


Current Reits allocation is around 36% of  Equity Portfolio.


Cheers

Cory
20180130

Cory Diary : Dividend Play and Timing

Let's take a REIT Stock which gives 7% dividends annually at current $1 tag. Assuming there is no major "calamity", that's 7 cents annually. Interests up few points during the year, how much is REIT impacted ?

1. Borrowing are secured across few years to decade contract. Some on annual basis. Some on fixed rate. Some Reits hedge their borrowing too.

2. Increase in borrowing cost can be passed down to tenants. In Retail is about 3 years contract. And typically contract renewal are staggers across the periods.

3. Some Reits have internal mechanism where rent escalation is tag to inflation and revenue

4. Rising rates mean the Market is able to absorb the increase to prevent bubble. Is not to kill the goose but to ensure longer road of growths.

Based on above, any dip in well managed Reits, are good entry points. Stock price fluctuation will be mitigated by the dividends. So what we have is likely upsides. Every year we leave too much cash in the bank, the cost are a lot more and is a loss in relative term to inflation.. A gap of 5% between interest and dividends for $100K is $5K. How many Ks we have in our Banks ?


Cory
20170411

Cory Diary : LMIR TRUST Report Q4 2016

LIPPO MALLS INDONESIA RETAIL TRUST

DPU 0.87 ( 7.4% increase )

For Stock Price of $0.385, Yield about 9%

Gearing : 31.5%

I like this REIT because of good Indonesian population base growth potential, income outside Singapore with mid term track record. Base on this quarter result, likely next few quarters we will see better rental revision thus potential growth in DPU.

DPU Track Record

The down side is interest rate, mitigated with 70% fixed rate basis. Forex is ok with weaker Singapore dollars. Is this a rare REIT gem ?

Cory

20170216

Cory Diary : REITs Investment

Reits have been in my portfolio for many years. Each year I learn "New Tricks" and pay some school fees. Instead of going through the learning pains, I like to document down what to look for and appears it can be boiled down to 4 pillars

Integrity

This is critical. While there maybe time for speculation, this is not my cup of tea. The other three below are more inter-connected.

DPU

The Managers can do share placement, issue rights, increase borrowing but at the end of the day is how much Dividends Distributed per Share/Unit. An increasing DPU is excellent. A stable DPU is ok in exchange for lesser risk.

Yields

Distributed Income/Current Price. If I am happy with the yield, that price is good price to invest.

While I may wait for opportune moment per chart, the timing will not be too long as price correction could be mitigated by dividend distributed. 

Capital Gains

Chances of higher stock price in the future requires active management of smart managers. This create a forward buffer for my investment. Capital gains should be accorded same recognition as initial amount invested. Money is money regardless gains are capital or not.

Cory

20170202

Cory Diary : CAPITALAND MALL TRUST 4Q16

Investing in CMT is one of a kind. It can hardly go wrong  if you have taken a peek on it's portfolio of assets. The issue with it will be the actual return after stock price fluctuation. And so investing in CMT is more important in the entry price and the yield Maths will work itself out.

The quarter annualized DPU is 11.46 cents. Yield about 5.92%. This is despite Funan undergoing redevelopment. Management has stated moving forward to focus sustainability of the DPU. I guess that will be the benchmark.

Assuming Stock market tank, the maximum capital loss price will be around $1.82 after dividend will result in 6.1% yield assuming dividend able to maintain. Will you buy more or hold or sell ? This logic is important because stock price can continue to go lower to $1.7 as a test case. That will be about 23 cents loss or more than -11%. However Yield will go up to around 6.5%. If CMT fundamental is solid, do stock price matter for a dividend player mid to long term ? In fact for a million dollar asset invested, you will get 65K which some will be elated instead of just 58K currently.

What will the stock price and yield be after the funan site has re-developed complete ?


Cory
20170128


Notes:

"CMT’s current portfolio comprises 16 shopping malls which are strategically located in the suburban areas and downtown core of Singapore 

- Tampines Mall, Junction 8, Funan (formerly known as Funan DigitaLife Mall), IMM Building (“IMM”), Plaza Singapura, Bugis Junction, Sembawang Shopping Centre, JCube, a 40.0% stake in Raffles City Singapore (“RCS”) held through RCS Trust, Lot One Shoppers’ Mall, 90 out of 91 strata lots in Bukit Panjang Plaza, The Atrium@Orchard, Clarke Quay, Bugis+, a 30.0% stake in Westgate held through Infinity Mall Trust (“IMT”) and Bedok Mall held through Brilliance Mall Trust (“BMT”)."

"CMT owns approximately 14.1% interest in CRCT, the first China shopping mall REIT listed on the SGX-ST in December 2006.'

Cory Diary : Frasers Centrepoint Trust 1c17

I actually blogged a lot on FCT. My poor memory was thinking it was a year ago. (Corrected)

Key Takeaway

NAV $1.93. Last closing share price is $1.965. Slightly above book value. Management has said they will maintain 100% payout of roughly 5.9% yield.

The AEI trough expects in May'17 and recover after. AEI completion in Sept'17. Expecting possible further few percentage reduction in NPI in the next report.

Gearing at 29.7% and the weighted average debt maturity was 2.6 years. The all-in average cost of borrowings in 1Q17 was 2.1%. FCT has approximately 56% of its borrowings on fixed or hedged-to-fixed interest rates. Good !

There is potential of lower share price for 1st half of 2017 but I believe the dividends will be able to cover more than it. And with the potential boost in future DPU in the 2nd half of 2017, this maybe a relatively attractive stock to own.


Cory
20170122

Cory Diary : Sabana Reit

The purpose of this article is to share the danger of the stock market. The game is not fair.

Sabana Shari'ah Compliant Industrial Real Estate Investment Trust


(updated for privacy)  It was darling in the market with it's high yield. I even named it as one of my retirement counter. And then when the master lease issue comes in, I found something a miss.

Started with reducing exposure and then a complete cut loss. From the tip of 1.37 top price, my final cut loss is at 1.055. That's - 22% which is a little late but never late than never. The share price continues to slide down to below $0.50. Losses would have ballooned (updated for privacy)  instead of just $1,442. Never look back again. (updated for privacy)

That's the SHARKS in the market retailer have to be aware. The game is not fair and we need to be on constant vigilant of such as it is worst than casino.


Transaction records below.

Date	Price	Trans	Shares	Trans Value	Comments
28-Dec-12	$1.135	B	30,000	($34,158)
9-Jan-13	$1.155	B	10,000	($11,587)
18-Jan-13	$1.160	B	20,000	($23,274)
23-Jan-13	-	D	-	$1,446	Dividend
1-Apr-13	$1.275	S	20,000	$25,419	Quick trade
23-Apr-13	-	D	-	$964	Dividend
28-May-13	$1.310	B	7,000	($9,201)
30-May-13	$1.240	B	7,000	($8,711)
31-May-13	$1.225	B	16,000	($19,662)
3-Jun-13	$1.215	B	10,000	($12,189)
14-Jun-13	$1.140	B	5,000	($5,730)
19-Jun-13	$1.190	S	7,000	$8,299	Quick trade
23-Jul-13	-	D	-	$1,872	Dividend
19-Sep-13	-	D	-	$1,716	Dividend
23-Oct-13	-	D	-	$140	Dividend
22-Nov-13	$1.085	S	28,000	$30,283	Reduce Exposure
27-Nov-13	$1.090	S	10,000	$10,865	Reduce Exposure
23-Jan-14	$1.055	S	40,000	$42,066	Cut Loss
				($1,442)	Loss include Trans Cost

 Will I trust the management again ? Will you ?

Hard Earn Money leh ...

Cory

20161222

Cory Diary : When higher Dividend has a Price

Just when I thought 2016 will be the year my Dividend will finally dipped since embarking on dividend strategy, year-to-date I have hit another all time high (updated for privacy) . So what happened ?

Thanks, but not thanks, due to "anticipated" Neretal special dividend of 15 cents but with more than 20 cents dent to the Share price after ... a heavy price to pay for indeed if you are someone who has been tracking this counter. Is definitely not a Saizen. And I am not pleased.

If anyone think that dividend strategy does not work locally, think again. (updated for privacy).

Will I be able to maintain this new level of dividend next year ? Probably considering my portfolio is still not optimise. Still some work to do. Another is the high cash level which I have been deliberating on to use. Quite an amount in foreign currency which has hedge S$ currency weakness.

Good news for this two weeks will be my income currency has appreciated 8% relative to Singapore dollars. The bad news is that the rate is dynamic and many of my assets are Singapore dollar denominated including loans.But then interests rate is moving up. And my portfolio is muted towards the Trump Rally to my dismay. One good thing out of it is that our labour cost reduced by 8%. And property in relative terms has become cheaper by 8% too. This is really good for Singapore reeling from high cost of labours and property prices.

Talking about interests rate. Reits got skinned recently and I dipped for some. So glad to be back in the 6%-10% yield range. In the Telco front is a slaughter.I have avoided Starhub and M1 specifically for the past year. Singtel I feel is ok because whatever go down likely will come back up. It is more sentiment for a diversified and strong counter. Will there be special dividend after coming one ? oh no ...hope not another Neratel. There has been huge outflow of money from developing world back to America pushing the DJIA to another high. I would be prepared for the tide returning.

What's more ?

Busy weeks on travel. America is still a land of plenty, and waste. Consumer market rule.
Salary and Bonus assessment period. :)

Cory
20161125

Cory Diary : FRASERS CENTREPOINT TRUST

Home Work

Noticed a significant drop in FCT yesterday. This caught my eyes as I have been waiting for a good time to re-enter. A check in regular sources have no obvious news. Some retailers attempt to collect. There is a rather large selloff after trading hours at $1.89 which appear to be from a single entity. Do note some time back there is news of CEO change.


Previous Trades

May have to click the picture below to see the details. Recorded rationale on the trades that time.
I like the Mall Business at suburb which rental is not impacted. AEI keeps me a little awake which i blogged earlier.

(updated for privacy)

There is some resistance around 2.00 to 2.02.  I am a poor timer, quite busy recently due to company re-org, fear of losing and no insider. So decided to sell FCT without waiting for the next dividend distribution.


Next Step

Bre-Exit is round the corner. US has another major gun incident. Market quite shaky. Our local economy still in the muddy water. With the FCT AEI still in the midst. Will wait for reports and better opportunity. I really like this Mall counter.


Cory
20160618

Cory Diary: Reading Frasers Centrepoint Trust Annual Report 2015

Just received the latest annual report this week. Taking some notes.

Titled "SUSTAINING LONG-TERM GROWTH". This tells me something or am I reading too much into it ?

Financial Highlights
Share price is below book value.  6.3% Yield. Less impacted by the poor retail environment.

AEI
Northpoint - 2nd largest mall in the portfolio will undergo AEI in phases over 18 months. There's hint on possible acquisition of new assets in their sponsor's portfolio. Nevertheless I look forward to the NPI number due to the AEI impact !

Occupancy and Expenses
84.2% occupancy in Bedok Point. Maybe they should sell it than holding the baby for the parent. Anyway is only 3.8% of the Reit. Changi Point will be something we need to understand in next few quarters. Overall expenses increased 14.9% which is above Gross Revenue and NPI growths.

Financing
Gearing 28.2% at 2.4% cost. If interest go up to 2.8%, cost may increase by $2.9M for $718M loan. Most of the debts (38.7%) is less than a year which means around $1.11M hit. NPI for Q4 alone is 31.7M. So impact looks minimal less market sentiment.

Thoughts
Northpoint NPI is $36M for FY2015. The integration and key spots upgrades will be nice and strategic. Let's put a $3M price tag to operation. Is the figure realistic ?

Headwinds are interests cost, lowering rental revision and reducing HEKTAR income. If another acquisition comes in 2016 this will further boost the distribution considering there is still some room to gear.


Cory
20160102

Cory Diary : Portfolio update 20151012

If someone has said in the beginning of the year that China will be the main reason that STI enters correction territory it will be quite hard to accept. Such is the market dynamic. Hard to anticipate even for expert.

Is the correction over with recent days run up ? Well just looking at the 1 yr and 2 yr charts, seems so. However 5 yr and 10 yr charts are yet confirm. That's my own view. Time will tell !

My portfolio ytd went down -5% at the worst period and recovered to -2.6%. STI still at -10% today.
Relative wise i am doing ok but i could have done much better if i have cut loss faster as said in my earlier article.

For those data craze, Equity at 37%. Cash/FD 39%, Structured Investment/Bond 11% and others.
China could have cause another major crisis. It didn't so far. Else i could have tap my war fund.

Decided to sell Saizen Reit as i feel the Japanese yen will continue it's weakening mid term and this gives me some anxiety despite all those hedging in place. Hope to find a replacement soon. Still holding to some Starhub shares though no increase. I feel the impact of 4th Telco will be mitigated by immigration long term.

I sleep well with current portfolio set up and that's all matter. cheers.


Cory 20151012

Cory Diary : SAIZEN REIT

In my quest for yield, a reit that caught my eye again is Saizen Reit. What's interesting is the recent softening of it's price due to the depreciation of the Yen mainly. 6 cents move is a year dividend ... oh a little pain..

Few questions come into my mind. Is there opportunity to gain/recover from this ?

Impact to S$ returns

"Hedged the distribution payments for the six-month financial period ending 31 December 2014 and for the six-month financial period ending 30 June 2015 at JPY81.9/S$ and JPY85.6/S$ respectively."

This hedging is rather important though not cheap. Looks like they did it well considering rate is about 91 currently. I do not see dividend issue for Mar'15.

Property Yield
About 1/4 of the portfolio in Sapporo: Prices known to increase in that area but Cap Rate maybe mute.

Age of the Reit properties are not young so i would perceive rental yield stable considering the net property income in last report shows slight decrease in JPY Q/Q not proportional to Revenue decrease.
S$- denominated bank balances help a little from the Warrant proceeds leftover.

Trend
Revenue has been decreasing about 2% quarterly. Operating expenses increased slightly from the net property income of lQ'15 report.

"The decrease in gross revenue was due mainly to a year-on-year decrease in occupancy rates."

Leverage Potential
Ability to access low fixed loan rate is a plus for higher leverage considering their returns are relatively stable.

Moving Forward
One thing to watch is the the weekend election and what this means to Saizen. Abe wins mean more weakening of the Yen therefore more hedging needed. Delay in consumption tax hike is good news.


Cory
14th Dec 2014

Cory Diary : Dividend Dimension

Why Dividends ?

Keep my CEOs on their toes
Best proof of returns
Income sustainability

(updated for privacy)

No turning back on the Twin Pillars Strategy - Dividends & Growths.
Q1 2014 has been slow due to divestment of some Reits counters. Of course is still in the earlier part of the year. Building portfolio back up with strong cash companies. I will have to catch up to beat 2013 dividends but not going to lose an arm or leg for it.

Cory

17th April 2014

Cory Diary : Reits 2014

Despite my preference for "fixed income" and being a "landlord", the leverage mechanism of Reits and Management have been trying this days. Facts - Reits are mainly in downtrend and is hitting home with starts of QE. Interest Rates are not even in the picture yet. Things will be tough this year as well if the strong ones are also doing fund raising.

There are still few gems out there but is not a guaranteed profitability net-net. Meaning after Rights, Placements, Dividends and Market Value, are we better off is a big question mark.

Managers are securing funding to lower their gearing. Meaning no additional returns from the funding exercise. Isn't this much worst than investing in a lower yield property than current DPU ? Not sure i should classify it as one of ultimate worst sins.

The Property Market has hit the ceiling. We should be expecting book value hitting north but the market pricing seems ahead on that giving us a value proposition that is actually sliding with lower price and value.

I still view Reit a key segment in my portfolio but there is also a time for everything. At the mean time, do look at the trend chart and draw your own conclusion.

Happy Reit'ing !

Cory
19th Feb 2014