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, February 4, 2016

Analysis of AIMSAMP Industrial REIT

Current Price on 26th Jan 2015 = $1.355
  • Yield = 8.41%  
  • Price-to-book Ratio = 0.893
  • Assets per unit = $2.303
  • Debt per unit = $0.786 (including current liabilities)
  • Gearing = 34.1%
AIMSAMP Industrial REIT has published their results recently which I am quite pleased. The reason is that finally the fruits of AEIs which they have embark on is giving strong returns in dividends which resulted in an increase in distribution. Let's look at the statistics.

Yield is currently at 8.41% which is quite comparable to its peers which yield ranges from 7.17% (Ascendas REIT) to Cache Logistics Trust (9.90%). Its price-to-book ratio is at 0.893 which is also quite comparable to its peers. Gearing is at a healthy 34.1%.

I would say that this counter is currently at fair value and is no longer as cheap as before. Maybe it is because other counters have fallen more than usual which resulted in this situation because I remember it has been quite attractive even at higher price. I have 11,000 shares and will hold on for more dividends and potential growth but will look into other counters for new investments.

Monday, February 1, 2016

Singapore Reit managers advised to consider buying back units , News, News, AsiaOne Business News

Singapore Reit managers advised to consider buying back units , News, News, AsiaOne Business News:

'via Blog this'

Read an interesting article which advise REITs to buy back their own shares. In my opinion, it is a good thing because ultimately, it is not about growing the REIT but more about creating value for investors.

Wednesday, January 27, 2016

Analysis of Sabana REIT - Still in troubled times

Current Price on 26th Jan 2015 = $0.66
  • Yield = 9.09%  
  • Price-to-book Ratio = 0.742
  • Assets per unit = $1.583
  • Debt per unit = $0.696 (including current liabilities)
  • Gearing = 43.9%
Sabana REIT just published their results which is quite disappointing as their distribution drops but quite a lot (more than 10%). Moreover, their valuation also drops by 9% according to their reports, which is very unfavourable. Let's look at the statistics.

With the drop in yield and NAV, the price has dropped to $0.66 which gives a yield of 9.09% currently. However, they are in the midst of negotiating another three properties for master lease and one conversion, I believe yield will continue to drop. Assets per unit has dropped which means their price-to-book ratio has risen to 0.742. Still not too bad considering the valuation at current economic climate and it is the cheapest among the Industrial REITs. Gearing is at a high of 43.9%. Please note that I use all liabilities instead of just debt.

From the statistics, it look promising, with high yield and favourable price-to-book ratio. However, with the problems coming up, I don't see the yield going up anytime. In fact, I do see it going down further. The only positive thing is its small size, which makes it a possible target for take over. I am vested only with 1,000 shares so will see what happens. Maybe a white knight will come if they see value in this, hopefully.

Monday, January 25, 2016

Analysis of Fortune REIT

Current Price on 20th Jan 2015 = HK$7.79
  • Yield = 6.14%  
  • Price-to-book Ratio = 0.61
  • Assets per unit = HK$19.43
  • Debt per unit = HK$6.671 (including current liabilities)
  • Gearing = 34.3%
Fortune REIT publish their results recently which I thought was quite favourable. Let's look at the statistics.

Yield is at a modest 6.14% which is hardly exciting but their price-to-book ratio is 0.61 which means we are buying at almost 40% discount to NAV. Do note that they have been trading below NAV since their launch. Gearing is at a healthy 34.3%.

As we move to focus on NAV than yield, this looks very attractive. Moreover, it is in HK dollars which is likely to appreciate against the Singapore dollar (since it is peg to the US dollar). Thus, if you are investing in this, you are also technically investing in US dollars which is also favourable to you. However, I don't expect anyone to launch a takeover bid on this REIT due to its size so their NAV may not be realized. What I can think about is their asset recycling strategy which will help to realize some of their NAV.

I am not vested in this as their yield is way too low.

Thursday, January 21, 2016

Analysis of CapitaLand Commercial Trust

Current Price on 20th Jan 2015 = $1.31
  • Yield = 6.63%  
  • Price-to-book Ratio = 0.738
  • Assets per unit = $2.235
  • Debt per unit = $0.461 (including current liabilities)
  • Gearing = 20.6%
  • Secured NAV = $1.775 (135% of trading price)
CapitaLand Commercial Trust has reported their results which in my opinion is quite favourable given the fundamental shift from looking at Yield to looking at NAV. Here is the data.

Yield is at 6.63% which is hardly exciting but its NAV is a big plus. It has a price-to-book ratio of 0.738 which means we are buying at about 26% discount. Moreover, as their debts are all unsecured, it means that all properties are technically quite safe from being seized by banks. Thus, we have a secured NAV of $1.775 which is 135% of their current trading price. This means that if they liquidate all their properties and pay off all the debts, we get $1.775 back.

This doesn't mean that they will do that. They are the biggest Office REIT and it is very unlikely that they will be taken over. The purchaser will need a lot of money to do that. But the manager can choose to sell off some of their properties to realize the value of the investments and create true value for shareholders. One news report is already suggesting that.

We need some news and announcements that some REITs are doing just that to spur the activities of REITs so that their trading price is closer to their NAV. I believe once CCT announce the sale of one of their properties, price will go up. I am not vested though so just watching the news.

Monday, January 11, 2016

Analysis of Keppel REIT - Quality Office at a Bargain Price

Current Price on 8th Jan 2015 = $0.915
  • Yield = 7.43%  
  • Price-to-book Ratio = 0.648
  • Assets per unit = $2.309
  • Debt per unit = $0.897 (including current liabilities)
  • Gearing = 38.8%
Keppel REIT was once my anchor investments which has given me a great deal of rewards with strong yield and capital appreciation. Now I realize that it has fallen to a level which attracts my interest.

With a yield of 7.43%, it is not really fantastic although it is still quite high among the office REITs. But what attracts me is their price-to-book ratio which is at 0.648. This means we are buying at 35% discount to NAV which is quite a bargain. Compared to the largest office REIT which is Capital Commercial Trust, it is still about 10% cheaper. Gearing is at a healthy 38.8% which is not in danger.

The yield and price-to-book ratio caught my eye and I am willing to consider reinvesting into this counter since the statistics is quite good actually. Let's see if there are other good counters around first.