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.

Monday, August 9, 2010

Report on First REIT

First REIT ($0.88 on 14th July 2010)

  • Current Yield = 8.68%  
  • Price-to-book Ratio = 0.837  
  • Assets per unit = $1.242  
  • Debt per unit = $0.185 (Interest Rate at 4.2%) 
  • Gearing = 14.9%

According to CIMB report, it looks like there is likely to to be an acquistion and a equity raising coming up. To achieve a yield-acretive acquistion without increasing risk seems a difficult task especially of its current high yield. Therefore, it really depends on the terms and conditions that First REIT is providing us.

According to my criteria, First REIT stills fit in perfectly. Moreover, CIMB and SIAS has reported that investors have placed a premium risk on Indonsian assets which I still feel is legitimate. Although the economy of Indonesia has been improving in the recent years, it is still not as safe as REITs with Singapore assets. But First REIT (along with LMIR) has kept its debt level to below 15% to boast investors' confidence.

I am attracted by the high yield, low debt level, and the fact that it is trading below NAV. With an impending rights issue coming up, I am thinking of increasing my holdings on First REIT.

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