Welcome

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 $3,800/month.

Wednesday, November 8, 2017

Analysis of ESR REIT - With a Sponsor comes strength?

Current Price on 31st October 2017 = $0.555
  • Yield = 6.95%  
  • Price-to-book Ratio = 0.87
  • Assets per unit = $1.123
  • Debt per unit = $0.485 (including current liabilities)
  • Gearing = 43.2%
  • Secured NAV = $0.638 (115% of trading price)
ESR REIT is formerly Cambridge Industrial Trust. Their change in name reflect that they have a strong backing now. Let's take a look at the statistics.

Yield is at a weak 6.95%. It is considered weak as I have expected higher yield from the same value of properties. Their price-to-book ratio is 0.87 which means that we are buying at a 13% discount. Only Sabana REIT is trading at a higher discount to book value which probably gives more value for money buys. EC World REIT is also trading at 0.87 price-to-book value but they are based in China. Gearing is at 43.2%.

What is attractive is that now their loans are all unsecured which means their secured NAV is $0.638 which is 115% of their trading price. It gives a lot of margin of safety to the investors and in the worst case scenario, we are probably still looking at getting back this amount. :-)

Another point to note is that they are buying a property which should be completed by this month. This will help to improve their yield to about 7.5% which in today's standards, is quite attractive.

I have recently purchased 55,000 shares of ESR REIT due to its margin of safety and its improved yield. May not be the best in the market but certainly fulfill my needs.

Friday, November 3, 2017

IPO of Keppel-KBS US REIT

IPO Price = US$ 0.88
  • Yield = 6.80%  
  • Price-to-book Ratio = 1.052
  • Assets per unit = US$ 1.326
  • Debt per unit = US$0.489 (including current liabilities)
  • Gearing = 36.9%
With the withdrawal of one of the IPOs earlier, this is one which I hope will pull through. Let's take a look at the statistics.

With a yield of 6.8%, it doesn't look exciting. Manulife US REIT is yielding higher at 7.05% which is probably better. Moreover, its price-to-book ratio is at 1.052 which is almost the same as Manulife US REIT. Gearing is at 36.9% which is quite safe.

US REITs listed in SGX is not common and this is the second one. Thus, we have to compare it to see how they are valued. From the looks of it, it does look the same so I am assuming that it is fairly valued. Thus, this looks more like a growth story since they are adopting an aggressive acquisition stand.

I would love to apply for its IPO if I have some cash but I may not be able to do it. Just that we should not assume that we can earn something from day one of its listing.

Wednesday, November 1, 2017

Analysis of Viva Industrial Trust - Is it time to sell?

Current Price on 31st October 2017 = $0.98
  • Yield = 7.76%  
  • Price-to-book Ratio = 1.241
  • Assets per unit = $1.37
  • Debt per unit = $0.58 (including current liabilities)
  • Gearing = 42.3%
Viva Industrial Trust has been moving up by quite a lot ever since they publish a good set of results. Let's take a look at the statistics.

With a yield of 7.76%, it is probably quite decent by today's standards. Even though it is below my target, it is still quite high comparable to other REITs. The problem is that their price-to-book ratio is 1.241 which means we are buying at a 24% premium. Not very sure why the valuation is so low when the yield can be so high. Is there something that I missed? Gearing is at 42.3%. Decent but high.

I am vested with 87,100 shares which I bought long time ago. With the run-up in share price and its high price-to-book ratio, I may be looking to sell them, take profit and switch it to another REIT. It may not increase the yield but at least the margin of safety would be bigger. One possible target is Soilbuild Business Space REIT which has fallen by quite a bit recently. Nevertheless, I need to be able to find a target as there are very few opportunities left in the market.

Friday, October 20, 2017

Analysis of Soilbuild Business Space REIT

Current Price on 18th October 2017 = $0.69
  • Yield = 7.97%  
  • Price-to-book Ratio = 0.965
  • Assets per unit = $1,217
  • Debt per unit = $0.502 (including current liabilities)
  • Gearing = 41.2%
  • Secured NAV = $0.548 (78% of trading price)
Soilbuild Business Space REIT has been in the limelight for the wrong reasons. Firstly, one of their tenants could not pay rent so income is impacted. Moreover, one of their properties is still almost vacant and it is affecting income and also underlying value. Let's take a look at the statistics.

Yield is currently at 7.97%. It is supposed to be higher but their DPU dropped by quite a bit comparing to the previous quarter so it is a concern. Price-to-book ratio is at a good 0.965 which means we are buying at a 3.5% discount. Not a lot but not so bad either. Gearing is at 41.2% which does not allow any inorganic growth. It has secured NAV which is close to 80% of their trading price. It serves as a margin of safety although not really safe either.

I am vested with 100,000 shares which I intend to hold and it gives pretty high yield relatively. However, things are getting tricky now and I am not sure whether the DPU will continue to drop. Hope that it is not as much. Not exciting but not worth to change as well.

Monday, September 11, 2017

IPO Analysis of Cromwell European REIT

IPO Price = Euro 0.57
  • Yield = 7.50%  
  • Price-to-book Ratio = 1.00
  • Assets per unit = Euro 0.828
  • Debt per unit = Euro 0.255 (including current liabilities)
  • Gearing = 31.1%
Finally we have a REIT listing in this second half of this year with a European REIT focusing on logistics. Let's take a look at the statistics.

With a yield of 7.5%, it look quite decent but there are other REITs which are local-based and able to deliver higher yield like Cache Logistics Trust, Soilbuild Trust, etc. Moreover, they are selling at market value which is not really attractive because there are other REITs which are trading at a discount. Some of these have moved to become premium REIT so the price may well just hold up. Gearing is at a comfortable 31.1%.

Do note that it is trading in Euros so there is currency risk, and European Central Bank is still printing lots of money so Euros may just continue to fall. While I thought this is decent, the currency risk doesn't help.

I will be taking a backseat on this REIT (I have been doing it for a while actually) and see whether the price hold up.

Thursday, August 24, 2017

Updating my Current Portfolio - Increasing Yield

Hi everyone,

Here are some of my updates on my portfolio since July.

Ascendas Hospitality Trust

With them trading at 10% discount and a low yield of 6.28%, I felt that it is time to let go (80,000 shares at $0.835) and enjoy the capital appreciation that I got as well as the previous dividends declared. This investment is about 7 months which is very short. Not good actually but with the recent run-up in price, there is a need to relook and see whether is it still worthwhile to hold on to it. For this investment, there is another opportunity so I jump at it.

Dasin Retail Trust

With the cash that I obtained, I bought 80,000 shares at $0.80 (14,400) and $0.81 (65,600) two weeks ago (when I posted my analysis). With a steep discount to NAV and high yield (with sponsor wavier), I think this is a good investment with a large margin of safety. I am just thankful that I bought it in time because it has run up to $0.84, giving me about $2,000 in capital appreciation. I shall hold on to it while enjoying the dividends. With this, I have also increased my monthly yield as well which is the original intent.

With that, here is my updated portfolio as of 23rd Aug 2017, giving me $4,400 passive income monthly which is fantastic. It is like having another person working at home.


Monday, August 7, 2017

Analysis of Dasin Retail Trust - A hidden diamond just uncovered.

Current Price on 4th August 2017 = $0.81
  • Yield = 8.40%  
  • Price-to-book Ratio = 0.487
  • Assets per unit = $2.971
  • Debt per unit = $1.308 (including current liabilities)
  • Gearing = 44.0%
Some of my readers are asking about Dasin Retail Trust which I researched on it. The results were fantastic. I wonder why I did not research on this previously despite it staring at me. Let's take a look at the statistics.

With a yield of 8.40%, it is one of the highest yielding REIT in SGX now especially in the retail sector. Moreover, they are trading at a whopping 52% discount to NAV. It means that we are buying it at at least half price. Do note that all their properties are based in China. But we do have other China-based REITs like Mapletree Greater China Trust and CapitaRetail China Trust which are trading at good value so it shouldn't be a problem here. Their Gearing is at a high of 44.0% but not so much of a worry as of now.

I am considering to switch some low yielding REITs or Trusts into this now I know that there is such an option. Moreover, I have queued and purchased 14,400 shares at $0.80 last week. No matter what, I will be queuing to buy more this week, hopefully to increase my shareholdings as much as I would like.