For reits, I think it is safe to assume one is buying for the sake of distributions as well as future likelihood of DPU increments. In which case, a capable management with strong character, likely asset enhancements or yield accretive acquisitions, and good cushion against downside is most important. And by downside, I mean really nasty surprises and not just a slightly lower cashflow due to the way the rental yield is imbued.
Unless one has the ability to acquire enough shares in a company to be able to have a voice in management decisions, rarely would I think buying for ownership is a serious concern for anyone.
(07-12-2010, 04:48 PM)Blackjack Wrote: For reits, I think it is safe to assume one is buying for the sake of distributions as well as future likelihood of DPU increments. In which case, a capable management with strong character, likely asset enhancements or yield accretive acquisitions, and good cushion against downside is most important. And by downside, I mean really nasty surprises and not just a slightly lower cashflow due to the way the rental yield is imbued.
Unless one has the ability to acquire enough shares in a company to be able to have a voice in management decisions, rarely would I think buying for ownership is a serious concern for anyone.
the attached articles on reits published in the Pulses touch on many of the discussion points in the forum, worth a read
Thank you for posting the articles...it was very informative.
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.
Thanks for posting the articles nextwave. I used to go Spinelli for my monthly coffee and free Pulses in the past too, but stopped ever since they stopped the tie-up. Pity.
24-12-2010, 05:06 PM (This post was last modified: 24-12-2010, 05:07 PM by Satchmo.)
Thanks for the discussion and articles. Very enlightening.
Am interested as am vested in a few since 4 yrs ago. Returns have been ok when coupled with captial gain. There are some in the right industry and with good balance sheet year on year, tho the PE and price to NAV is not really attractive to the classic value investor.
If u manage to pick up some during the crisis period, I think can hold for many years to come.
(20-11-2010, 07:29 PM)Nick Wrote: Personally, I will stick with business trust with very low payout ratio (should be less than their profits) so that NAV can grow organically with retained earnings being used to partially fund new acquisitions. Such a company would have similar payout structure as a listed company. REITs do not qualify since they have the 90% payout rule.
With that being said, I believe that all companies are good companies at the right price so if a decent REIT is trading at a double digit yield, I don't mind entering !
That was what exactly happened last year. After Suntec REIT refinanced the loan in Apr 09, I accumulated from 70cts to $1. The yield was from 10% to 15%
The only REIT I have now is Saizen REIT warrant. Expires in 18 mths.
(20-11-2010, 07:29 PM)Nick Wrote: Personally, I will stick with business trust with very low payout ratio (should be less than their profits) so that NAV can grow organically with retained earnings being used to partially fund new acquisitions. Such a company would have similar payout structure as a listed company. REITs do not qualify since they have the 90% payout rule.
With that being said, I believe that all companies are good companies at the right price so if a decent REIT is trading at a double digit yield, I don't mind entering !
That was what exactly happened last year. After Suntec REIT refinanced the loan in Apr 09, I accumulated from 70cts to $1. The yield was from 10% to 15%
The only REIT I have now is Saizen REIT warrant. Expires in 18 mths.
Me too. Picked up REITS agressively last year for good dividend yields & shore up a defensive portfolio for long term holding.
Div yields at my buy price for Suntec at 15%, CDL 30%, Ascott 20%. Parkway Life 13%, etc. REITS is now 30% of my portfolio.
Interestingly, I also picked up ARA in the process & it is yielding a decent 15% at my purchase price last year.
(20-11-2010, 07:29 PM)Nick Wrote: Personally, I will stick with business trust with very low payout ratio (should be less than their profits) so that NAV can grow organically with retained earnings being used to partially fund new acquisitions. Such a company would have similar payout structure as a listed company. REITs do not qualify since they have the 90% payout rule.
With that being said, I believe that all companies are good companies at the right price so if a decent REIT is trading at a double digit yield, I don't mind entering !
That was what exactly happened last year. After Suntec REIT refinanced the loan in Apr 09, I accumulated from 70cts to $1. The yield was from 10% to 15%
The only REIT I have now is Saizen REIT warrant. Expires in 18 mths.
Me too. Picked up REITS agressively last year for good dividend yields & shore up a defensive portfolio for long term holding.
Div yields at my buy price for Suntec at 15%, CDL 30%, Ascott 20%. Parkway Life 13%, etc. REITS is now 30% of my portfolio.
Interestingly, I also picked up ARA in the process & it is yielding a decent 15% at my purchase price last year.
Well, I bought too early before the credit crisis.
I started investing in UMS Holdings, Hupsteel, Mapletree Log and Metro in Year 2008.
Only kept Mapletree Log as it is still giving me yield of 15% (Average Price = $0.488)
Now I am heavily vested in SAIZEN REITS...
Hope this REITS will finally turn around in year 2011..
Been holding this for more than a year already !!!!
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