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 $4,200/month.

Monday, May 22, 2017

Analysis of OUE Commercial Trust

Current Price on 10th May 2017 = $0.71
  • Yield = 6.17%  
  • Price-to-book Ratio = 0.829
  • Assets per unit = $2.245
  • Debt per unit = $1.388 (including current liabilities)
  • Gearing = 61.8%
OUE Commercial Trust has been in my portfolio for two years now with about 30,300 shares. It has generated two years of return and I am also sitting on a 10% capital gain. Let's take a look at the statistics.

With a yield of 6.17%, it is currently very low according to my criteria of 8%. But the good thing is that its price to book ratio is 0.829 which means I am buying at 17% discount even at current price. Gearing is at 61.8% because I have considered perpetual securities as loans instead of equities.

OUE Commercial Trust has served its purpose of helping me to diversify into Office REITs and their price has moved to a position where there is no reason for further improvement. I am looking at unloading this and looking for something else to put in.

Thursday, May 18, 2017

Analysis of Lippo-Malls Retail Trust - Fairly Valued

Current Price on 10th May 2017 = $0.415
  • Yield = 8.58%  
  • Price-to-book Ratio = 1.114
  • Assets per unit = $0.715
  • Debt per unit = $0.342 (including current liabilities)
  • Gearing = 47.9%
  • Occupancy = 93.8%
  • Secured NAV = $0.373 (86% of trading price)
LippoMalls Retail Trust has announced their results which is improving. However, their price went up by a lot as well so let's see how the statistics fare.

With a yield of 8.58%, it is now not the highest yielding REIT. There are others like Viva Industrial Trust and Soilbuild Business Space REIT which has higher yield. However, their price-to-book ratio is 1.114 which means we are buying at a 14% premium. This is not attractive at all. Gearing is at 47.9% with current liabilities and only unsecured debt. This means that their secured NAV is quite high at 86% of trading price. Still quite high but not as attractive as before. Please note that all assets are based in Indonesia.

Indonesia continues to grow at a moderate pace of 5% which I thought it was nice to be able to participate in their growth. This is probably the reason why it is priced high. But I think it is now fairly priced and it shouldn't be moving higher anymore. I will find chance to sell my current holdings.

Monday, May 15, 2017

Analysis of Accordia Golf Trust

Current Price on 28th Apr 2017 = $0.765
  • Yield = 8.26%  
  • Price-to-book Ratio = 0.756
  • Assets per unit = $2.20
  • Debt per unit = $1.188 (including current liabilities)
  • Gearing = 54.0%
Accordia Golf Trust is one of my anchor investments with high yield at very low discount to NAV when I purchased 100,000 shares at $0.63. It has since risen to this price which I am enjoying a paper gain. Let's take a look at the statistics again.

With a yield of 8.26%, it is still attractive although it is close to my minimum of 8%. Their price to book ratio is 0.756 which means we are still buying at 25% discount to NAV which seems very attractive. Their gearing is quite high though at 54% although not all of them are loans.

One of the issues is that they are all in Japan and we are exposed to currency fluctuations between Singdollar and Japanese Yen. So that is another risk that we would have to take if we invest in it. Well, I am taking the risk.

With this as an anchor investment, it is always on my radar but I won't be adding more as of now.

Friday, May 5, 2017

Analysis of Far East Hospitality Trust

Current Price on 28th Apr 2017 = $0.60
  • Yield = 7.47%  
  • Price-to-book Ratio = 0.646
  • Assets per unit = $1.394
  • Debt per unit = $0.465 (including current liabilities)
  • Gearing = 33.4%
  • Secured NAV = $0.929 (154% of trading price)
Far East Hospitality Trust has been on my radar these days and I have recently purchased 100,000 shares at $0.61. These are the reasons for me to do my purchase.

Yield is at 7.47% which is quite modest and not really up to my target of at least 8% but there are not many on the market in the first place. However, what it attracts me is the deep discount to NAV that it is trading at. It is trading at 35% discount which means we are buying hotels and serviced residences at such a cheap price. Moreover, their debts are all unsecured which means the secured NAV is at 154% of their trading price which is extremely attractive. Gearing is at healthy 33.4%.

With such deep discount and recent events which helps REITs to realize their NAV in the positive way i.e. Saizen REIT which is successful and Sabana REIT which is in the process. Discount to NAV seems to take over precedence over yield now. Their peers are also trading at a discount but not as much as Far East. So this is one main reason why I purchase them.

Will continue to look at it closely and enjoy the dividends that they are giving us. :-)

Wednesday, May 3, 2017

Analysis of Viva Industrial Trust

Current Price on 28th Apr 2017 = $0.815
  • Yield = 9.08%  
  • Price-to-book Ratio = 1.029
  • Assets per unit = $1.374
  • Debt per unit = $0.582 (including current liabilities)
  • Gearing = 42.3%
  • Occupancy = 91%
Viva Industrial Trust has published their results which is very favourable and has caused their price to increase to $0.815. Their price has been steadily increasing for a while already so have to look at the statistics again.

Yield is currently at 9.08% which is still very high at current standards. Moreover, with occupancy at 91%, there are still some room for further organic growth in yield but not a lot. However, one indicator which is getting not as good because of the rise in trading price is their price-to-book ratio. It is not at 1.029 which means we are buying at a premium. Compared to Sabana REIT, Cambridge Industrial Trust, AIMSAMP REIT and EC World REIT, it is no longer attractive. These REITs are still trading at a discount to NAV. Gearing is at 42.3% which is ok.

This is one of the REITs which I bought when it is still trading at a discount to NAV and it has risen. I am vested with 87,100 shares and I will be enjoying about $1,600 worth of dividends. Moving forward, I will be looking at other counters to see whether I need to unload and switch to another counter.

Tuesday, April 25, 2017

Updates on Current Investments - Quite major rebalancing

Hi everyone,

It has been a while since I blog. Has been very busy with work. But I did made some trades over the last week for the rebalancing.

Sabana REIT

I have sold off most of my holdings (229,000 shares) due to the uncertainty of the REIT currently. What I worry is that it will trigger defaults of the loans which lead to forced sale of assets. I decided that it is not worth the risk and sold off at $0.465. On the hindsight, I should have sold off earlier as the metrics are not looking good after the rally. But I have made money which is beyond my expectations.

Global Investments Limited

With this money, I have bought 250,000 shares of Global Investment Limited and increased my holdings to over one million shares. Their yield of excess 10% and price-to book value of 0.72 is still appealing and attractive. I still don't see any reason not to buy into it. Thus I have increased my holdings. With over one million shares worth $147,000, this is one of my anchor investments I am watching closely. Very stable and enjoying the dividends.

Soilbuild Business Space REIT

I have bought another 100,000 shares of Soilbuild Business Space REIT at $0.665. Their 9% yield and about 8% discount to NAV seems fair enough for me to enter. It will be better than Sabana REIT which is yielding at around 7.5% so I am getting more recurring income using the same funds. Of course, the discount to NAV is lesser but I mitigate with another purchase.

Far East Hospitality Trust

I have bought another 100,000 shares of Far East Hospitality Trust at $0.61. Has been waiting for it to drop but it doesn't seem to fall. So I guess I am taking a bigger risk here. The yield is modest 7.4% but I am buying at 33% discount which is huge. I am not sure why there is such a big discount but it is attractive to me. So I have bought into it.

With all these purchases, here is the portfolio that I have and I have increased my recurring income to $4,200 per month. Very good for me and my family. But I will need to watch carefully.

Monday, March 27, 2017

Analysis of Hutchison Port Holdings Trust

Current Price on 25th Mar 2017 = $0.457
  • Yield = 7.40%  
  • Price-to-book Ratio = 0.448
  • Assets per unit = $2.359
  • Debt per unit = $1.087 (including current liabilities)
  • Gearing = 46.1%
This is the first time I am writing about Hutchison Port Holdings Trust (HPH Trust). I remember when it was first listed, I was very negative about it and true enough, the price went down and continued its journey. It recently caught my eye simply because of their NAV. Let's take a look at the statistics.

With a forward yield of 7.40%, it is quite modest and ok just that this is a business trust and it has dropped from FY2016 of 9%. Thus, the issue here is intense competition and they are quite challenged. However, their price-to-book ratio is 0.448 which means we are buying at less than half the price. This is very attractive but do remember that this is a port business and not real estate so the operation efficiency does play an important role and it varies. And moreover, HK property and business are generally valued higher than normal which Singapore investors are not really buying into it. A similar counter is Fortune REIT which is trading at a low yield but deep discount to NAV. Gearing is at 46.1% which is relatively high.

HPH Trust already operates one of the busiest ports in the world and its shares is considered blue-chip. With such a deep discount to NAV, it does makes it very attractive. However, the yield is not compelling yet. The recovery of the yield will really depends on the world economy which I am not very sure when it is going back up again.

Still considering and weighing options but definitely one of the options recently.