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 $1,700/month.

Wednesday, May 4, 2016

Analysis of Viva Industrial Trust

Current Price on 3rd May 2016 = $0.73
  • Yield = 8.98%  
  • Price-to-book Ratio = 0.90
  • Assets per unit = $1.363
  • Debt per unit = $0.552 (including current liabilities)
  • Gearing = 40.5%
  • Occupancy = 86.9%
Viva Industrial Trust is one counter which I monitor closely because I am holding on 79,100 shares worth about $57,000. With the current announcement, let's take a look at the statistics.

Yield is at 8.98% which is quite ok in my opinion. One of the higher yields among the industrial REITs but not the highest. Cache Logistics Trust is higher. Their price-to-book ratio is at 0.900 which means that we are buying at 10% discount. This becomes tricky because there are others like Cambridge Industrial Trust, Sabana REIT which are much cheaper. Gearing is at 40.5% and their debt rating is at Ba2 equivalent.

I have included occupancy in the statistics from now on just to reflect assets which are not generating income. At 86.9%, it is probably one of the lowest among the REITs, even lower than Sabana REIT which is perceived to be in trouble due to falling occupancy. I would say that their occupancy is quite stable and there is potential room for growth in tenancy.

I am still holding on to this, but may pare down to reduce risks due to single counter. Some REIT must come with better statistics for it to happen.

Tuesday, April 26, 2016

Analysis of Cache Logistics Trust

Current Price on 25th Apr 2015 = $0.89
  • Yield = 9.16%  
  • Price-to-book Ratio = 1.014
  • Assets per unit = $1.478
  • Debt per unit = $0.601 (including current liabilities)
  • Gearing = 40.6%
Cache Logistics Trust deserve some attention because it is currently the one with highest yield among the Industrial REIT. Let's take a look at the statistics.

With a yield of 9.16%, it is the one with highest yield among the industrial REIT, beating Viva Industrial Trust by a whisker. The rest are all below 9%. However, a strange thing is that its price-to-book ratio is 1.014 which means we are buying at a slight premium. This is unusual because most of the REITs are trading at a discount. Gearing is at 40.6% which is managable but not very safe.

I am shifting to put more weight to price-to-book ratio which helps me to manage my portfolio risk which at this point is more important. Thus, I won't enter if it is trading at a premium.

Monday, April 11, 2016

Analysis of Sabana REIT

Current Price on 5th Apr 2015 = $0.64
  • Yield = 9.38%  
  • Price-to-book Ratio = 0.72
  • Assets per unit = $1.586
  • Debt per unit = $0.696 (including current liabilities)
  • Gearing = 43.9%
  • Secured NAV = $0.382 (60% of trading price)
Sabana REIT has been struggling with occupancy which is dropping by quite a lot with their current rate at 87.7%. I am expecting it to drop further when there are other rent expiry. Thus, I am expecting distribution yield to fall further by 10% - 15%.

Yield is currently at 9.38% but if it drops further, it may reach 8% only. One saving grace is that their price-to-NAV is much lower at 0.72 which means we are able to buy it at 28% discount. This is due to the lower yield that is coming in. Gearing is at 43.9% and their secured NAV is at 60% of their trading price.

I think if they are able to retain their current tenants, it will be a success in itself as they would be able to maintain distribution at current levels. Therefore if it really happens, it is actually a good time to enter this REIT with organic potential for further growth (although it will come only in two year's time when economy recovers)

One more thing is about consolidation of REITs sector which was previously mentioned. Sabana REIT is a small REIT which is susceptible for take over by other REITs or private funds. Thus, with such deep discounts to NAV, I won't be surprised that someone will take notice and purchase these properties at a discount and wait for it to rise.

I have a very small portfolio on this and will consider entering only after I look at other counters.

Thursday, April 7, 2016

Analysis of Ascendas Hospitality Trust - Sale of Assets dropped. Now what? (Updated as of 7.45pm)

Current Price on 7th Apr 2015 = $0.68
  • Yield = 8.53%  
  • Price-to-book Ratio = 0.966
  • Assets per unit = $1.26
  • Debt per unit = $0.556 (including current liabilities)
  • Gearing = 44.1%

Ascendas Hospitality Trust just announced that they are not selling the assets which lead to a 10% drop in their share pricing. It is a surprise to me as to all shareholders as the opening price the following day does not allow any reaction time of existing shareholders. So now what? Let's take a look at the statistics.

With a yield of 8.53% now, their yield is one of the best among the Hospitality Trust, comparable to OUE Hospitality Trust and Frasers Hospitality Trust. Their price-to-book ratio is also at at 0.807 which is dependent on the latest valuation (Sorry guys, I did not realize that there is an independent valuation in an earlier announcement. Updated as of 7.45pm) which means we are buying at a discount of 20%. Probably those buyers are unwilling to pay at this price which resulted in the collapse of the potential deal. Gearing is quite high at 44.1%.

Moving forward, we can't just sell it just because of a negative news. Have to evaluate the fundamentals and theirs still seems good to hold at current price. Just that for those like myself who bought at a higher price, we are sitting at a paper loss which I am not overly concerned at this point because our mindset in investment is that we are buying a business, not a stock and we should believe in the business before we invest in it. So, for my 14,000 shares, I will hold on to it and enjoy the dividends.

Tuesday, April 5, 2016

Analysis of LMIR - Rising Steadily

Current Price on 4th Apr 2015 = $0.325
  • Yield = 9.97%  
  • Price-to-book Ratio = 0.847
  • Assets per unit = $0.709
  • Debt per unit = $0.325 (including current liabilities)
  • Gearing = 45.9%
  • Secured NAV = $0.384 (118% of trading price)
It is a new quarter where we are receiving a new set of data from each REITs. Let's look at some of the REITs with statistics which match my criteria. One of them is LMIR.

LMIR has a yield of 9.97% which is one of the highest yielding REIT if not the highest. Moreover, its price-to-book ratio is 0.847 which means we are buying at 15% discount. Gearing is at 45.7% which is actually quite high. However, their secured NAV is at 118% of their trading price which is excellent. But bear in mind that their properties are all in Indonesia.

Recently they have been acquiring assets from their sponsors but gave no indication on when they are going to complete these acquisition, whether it is yield-accretive and how does it enhance our shareholder value. However, it does give us a chance to invest in these properties which they offload. Something which we are unable to do without the REIT vehicle.

Its price has been moving up steadily due to, I believe, the improvement in Indonesian economy and also Rupiah. As I have said before, this is more of an investment in foreign currency than just property so I am glad that Indonesia is doing well. I am vested with 30,000 shares and I hope to put in more.

Wednesday, March 23, 2016

Response to queries from my readers

Hi everyone,

Many of you have been asking for the spreadsheet which I use to consolidate my investments. Well, the spreadsheet is easy but the updating is quite a hassle so do be mindful of that.

Having said that, I am providing you with an excel spreadsheet here for you to download so that you can use it to track your own investments, and your passive income as well. Enjoy.

Update at 1.15pm: I receive a number of request following the post. I am reposting the link so that you can download it as long as you have this link. I think it should work.

If it doesn't work, please let me know. Thanks!


Sunday, March 20, 2016

$10 Off for any purchase at Shopback.sg

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A dollar saved is a dollar earned. Every dollar counts towards our overall investment return so enjoy your savings and returns.