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, October 23, 2013

Analysis of Sabana REIT

Current Price on 18th October 2013 = $1.095
  • Current Yield = 8.69%  
  • Price-to-book Ratio = 1.012
  • Assets per unit = $1.764
  • Debt per unit = $0.682 (including current liabilities)
  • Gearing = 38.7%

Sabana REIT has published its results which shows a very promising 8.69% yield. This is by far the highest yield REIT with properties based only in Singapore (something which I think is an advantage). Of course, the tricky part is that its price-to-book ratio is at 1.012 which means it is trading at 1% premium.

I have a weird feeling because there are other industrial REITs trading at a discount to NAV and yet its yield is below Sabana's. Thus, I was thinking of the methodology of valuation i.e. Sabana's capitalization rate is higher.

In any case, 8.69% yield is very high and I am thinking of switching to this REIT from Cambridge or AIMSAMP REIT which I am currently holding on to.

1 comment:

  1. Sabana may incur negative income growth if it's occupancy drops next yr. not just historical yield but also yield growth