Welcome to my investment blog where I share with you my analysis of REITs in Singapore.

I hope that my investment philosophy will bring me a steady stream of income apart from my job. I am aiming for at least $3,000 per month which can sustain the current expenses of myself and my family.

Do enjoy reading my blog and post any comments that you have. I welcome them because it is a time to learn from each other.

When I am looking at investing in REIT, here are some of the guidelines that I am looking at. Feel free to comment on it. I am willing to listen to ideas.

-> at least 8% yield.
-> Price that is lower than its NAV.
-> Low gearing (if possible)
-> High secured NAV.

Current Dividend income is $1,450/month.



Thursday, October 8, 2015

Money Saving Tips Blog... Another great way to save and Earn

Hi everyone,

As you all know, I am also the owner of Money Saving Tips via Credit Cards where I will post how much I save using credit cards. From next week, I am expanding this blog of mine to include major discounts relating to memberships like NTUC member, PassionCard member, Credit Card perks. Now I believe that Credit Card rebates forms only one part of savings and these memberships form another (and even more major part) of savings.

Just a note, here are the memberships that I have which I will use.

1) RWS Invites Card
2) Sentosa Islander Card
3) HomeTeamNS Member
4) NTUC Member

Again I will be biased and I will post only those which is beneficial to me and my family. (So sorry SAFRA members, I know most of you are, but I am not)

So sit back, relax and wait for exciting saving tips from me. Enjoy.


Monday, October 5, 2015

Current Holdings... Increasing my Gearing to achieve higher yield

Hi everyone,

Last week, I have just bought another 154,000 shares of Global Investment Limited, bringing my total investment holdings to 784,299 shares which is really a lot and scary. Moreover this time round, I bought it with debt, thus increasing my leverage further. I just saw another opportunity, grab it and pay for it later since I now have this option. Is it dangerous? Well, yes but my intention is to pay down this debt with future savings which I am accumulating.

With that, here is my current holdings.

Valuation of my net assets has been dropping due to the recent fall in prices but it seem to have stabilized. I am also gaining experience in managing debt instead of just managing equity. I felt that I needed that (both pleasant and unpleasant) so that I can continue to grow in financial knowledge and experience.


Thursday, October 1, 2015

Analysis of Croesus Retail Trust - Rights issue which does not benefit

Current Price on 29th Sept 2015 = $0.83
  • Yield = 9.73%  
  • Price-to-book Ratio = 0.892
  • Assets per unit = $2.147
  • Debt per unit = $1.216 (including current liabilities)
  • Gearing = 56.6%
Croesus Retail Trust just announced their acquisition and rights issue which sort of neutalized the effects of acquisition. Here are the statistics.

Before acquisition, yield is 9.73% which is already very high. Moreover, price-to-book ratio is 0.892 which means we are buying at around 10% discount which is good. However, their gearing is 56.6% which is extremely high.

With the acquisition and rights issue, yield increases to 9.86% which is really not a lot considering that they needed a rights issue to finance its purchase. Moreover, price-to-book ratio will increase to 0.926 which means valuation wise, it is getting more expensive. Gearing falls to 52% which is also their intention.

Their rights issue is priced at $0.61. Thus, I believe that there will still be a demand for the rights issue since it is a sure win strategy aka hold a small portfolio, subscribe to rights and apply for excess rights. Price has already dropped to $0.83 so earning-wise won't be significant. However, due to budget constraints, I am not participating. 

Tuesday, September 29, 2015

Analysis of IREIT Global - A unique Europe REIT with Euro currency risk

Current Price on 28th Sept 2015 = $0.63
  • Yield = 10.62%  
  • Price-to-book Ratio = 1.05
  • Assets per unit = $1.104
  • Debt per unit = $0.503 (including current liabilities)
  • Gearing = 45.6%
IREIT Global is a unique Euro REIT with all their properties based in Germany. Their statistics are also quite unique.

Yield is at a high of 10.62% which is one of the highest in SGX. In fact, it is the highest yielding REIT (second to Accordia Golf Trust but Accordia Golf Trust is dependent on members playing golf in their golf course). However, its price-to-book ratio is 1.05 which means we are paying a premium for these properties. Well, there is no other comparable REITs in SGX which has Europe exposure so we have to take it as such. Gearing is at a high of 45.6% which in Singapore's standard is quite high. Therefore, it reflects the risks.

The price has been dropping quite steadily to $0.63 which resulted in their high yield. I am monitoring this counter and hopefully get more info about Germany property market before I make a decision. I am vested with 1,900 shares (a very small portfolio)

Monday, September 21, 2015

Analysis of Global Investment Limited - High yield savings account? It just melted.

Current Price on 8th Sept 2015 = $0.13
  • Yield = 11.54%  
  • Price-to-book Ratio = 0.619
  • Assets per unit = $0.217
  • Debt per unit = $0.007 (including current liabilities)
  • Gearing = 7.15%
  • Secured NAV = $0.21 (165% of trading price)
Ever since my previous post, the stock market melted quickly and Global Investment Limited is not spared. Moreover, it melted by more than 15% which is painful to investors like myself who is vested with about 595,000 shares. You can think of the impact that it has on myself.

Looking at the statistics now, yield is at a high of 11.54% which is extremely high. Price-to-book ratio is 0.619 which means it is trading at 38% discount of its NAV. Moreover, it has no debts which mean it is fully secured.

The only issue is that there is a significant portfolio which is in stocks and bonds and I believe they are not spared of the meltdown which at this point is still undetermined. Assets probably would have gone down. In my opinion, we should give it at 15% discount i.e. $0.1785.

I am still holding on to this and I am converting all my dividends into shares at $0.128 which is their conversion price. This gives me 34,888 shares and I would have a total of 630,299 shares (exact) worth $81,308. If I want to cash out my dividend, I would just need to sell about 66,000 shares to get $8,580. I will continue to hold on and ride through this. It has no debts, so there is no risk of failing.

Thursday, September 17, 2015

Analysis of Viva Industrial Trust - Considering Private Placement which is bad for investors.

Current Price on 9th Sept 2015 = $0.725
  • Yield = 10.20%  
  • Price-to-book Ratio = 0.872
  • Assets per unit = $1.403
  • Debt per unit = $0.572 (including current liabilities)
  • Gearing = 40.7%
  • Credit Rating = BB
Viva Industrial Trust has just announced that they are buying another property called Pioneer Property for $53.1 million. They claim that it is yield-accretive if it is 50% funded by debt and 50% funded by equity. Combining with the earlier announcement on acquisition of another 2 properties, yield is going to increase to 10.56%. However, there is a problem and it is increasingly becoming a big one for investors. Private Placement!

Private placement is good if you need to raise cash and you only needed a small enough amount. However to investors, it is never a good thing. In general, it is usually dilutive to NAV and yield. To their credit, they have tried to show in their documents that it is going to be better on the assumption that new units are priced at $0.74 but now trading price is already lower. So any private placement is going to be even worse, benefiting only certain investors (For the record, I manage to participate in one before just because I saw it in time and my OCBC broker happens to be able to do it for me. I don't know whether I will have a chance to participate in the next round)

To me, the best option is still rights issue simply because every investor gets a chance to participate which in my opinion is fair. Yes it is draggy because the whole process takes about at least a month but they are suppose to create investment value for us as managers right? Moreover, rights don't really create investment value. It is just an invitation for us to buy more shares and get more dividend. After that, the value drops and everything is likely to be in square one again.

I am vested with 79,100 shares worth now $57,000 (Sitting on a $6,000 paper loss). Even if they go for rights issue, I doubt I will be able to benefit a lot on it. Just hoping that there is no value destruction exercise coming along. 

Monday, September 14, 2015

Analysis of Keppel REIT - Getting more and more attractive.

Current Price on 8th Sept 2015 = $0.945
  • Yield = 7.28%  
  • Price-to-book Ratio = 0.669
  • Assets per unit = $2.309
  • Debt per unit = $0.897 (including current liabilities)
  • Gearing = 38.8%
  • Secured NAV = $1.142 (120% of trading price)
Keppel REIT's price has fallen to a level that I thought was quite attractive. Therefore, I have decided to look at the statistics for Keppel REIT.

Yield is now at 7.28% which is probably one of the highest among the office REITs. It is within my "yellow zone" which is between 7 - 8% yield. Price-to-book ratio is at 0.669 which means we are buying at 33% discount. Gearing is at an acceptable 38.8% while its secured NAV is 120% of its trading price. In the worst case scenario, we still can get back $1.142 which is great. Just great.

One point to note is that its assets are at the prime district of Singapore i.e. Marina Bay Financial Centre, Ocean Financial Centre, One Raffles Quay and Bugis Junction Towers. Imagine people telling you that you can own a piece of prime property at a 33% discount. Plus it gives you at decent 7.28% yield. I think this is the plus plus plus point for Keppel REIT.

Keppel REIT, in my opinion, has always been in competition with Fraser Commercial Trust for investors in the SGX market. Their statistics are always so similar in terms of yield. And now with Fraser Commercial Trust trading at only about 20% discount and Keppel REIT having better quality properties, I believe it is time to buy Keppel REIT for long term. In fact, when Singapore economy gets better, Keppel REIT will be the first to benefit and its trading price should go up.