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 11, 2016

Varde joins Blackstone in chase for $1.34bn Ascendas properties

Varde joins Blackstone in chase for $1.34bn Ascendas properties:

'via Blog this'

I have been trying to search for new news on Ascendas Hospitality Trust in hope to get further updates and here is what I got. Seems that it is going to be extremely exciting. (I am vested so I am even more excited.)

Wednesday, February 10, 2016

Analysis of Saizen REIT - Details from Circular on 5th Feb

Hi everyone,

Saizen REIT has published a circular detailing on the process that they will take for the sale to take place. Here are the details

Current Price = $1.09

Special Distribution = $1.056 (By 21st April 2016)
Retained Distribution = $0.09 (By 31st Dec 2016)
Dividend Distribution = $0.039 (Estimate 8 months from July 2015)
Total = $1.185

The catch is that the retained distribution may be used for repairs by the buyer which means we may not get the retained distribution. Thus, we are looking at $1.095 if all the retained distribution is used up.

Therefore, here is the deal. If all the retained distribution is used up, we are looking at 0.47% return from now which is equivalent to the returns of a savings account. If all the retained distribution is given to us, we are looking at at 8.68% return from now which is equivalent to a one year REIT investment with a guarantee in capital. Well, is this good for you?

I am vested with 21,000 shares. I bought 11,000 shares at $0.93 just before they announced their take over so I am going to enjoy a larger earnings. Another 10,000 shares is bought at $1.09 which will follow this formula which I have written here. Will follow through all the way to see whether I can earn the potential returns.

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.