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, July 27, 2015

Analysis of Mapletree Commercial Trust

Current Price on 24th July 2015 = $1.44
  • Yield = 5.58%  
  • Price-to-book Ratio = 1.164
  • Assets per unit = $2.014
  • Debt per unit = $0.777 (including current liabilities)
  • Gearing = 38.6%
  • Credit Rating = Baa1
Mapletree Commercial Trust has reported their results which I think is worth looking as one of the benchmarks in Retail REITs together with CapitalLand Mall Trust and Fraser Centrepoint Trust and Starhill Global REIT. Let's look at the statistics.

Yield is at 5.58% which I thought was comparable to the rest. Price-to-book ratio is at 1.164 which means we are buying at 16% premium. (Not favourable to me) Gearing is at a healthy 38.6% and they have a credit rating of Baa1 which is great for S-REITs.

I like Mapletree Commercial Trust because I like Vivocity. It is always so vibrant with lots of people enjoying themselves there. Moreover, majority are actually Singaporeans. Having Resort World Sentosa just beside to bring in tourist receipts just make it more attractive especially when the retail segment in RWS, in my opinion, is quite weak. Whether it justifies the premium is not my judgement call as I am not trained to quantify it. Of course, the trading market does say so.

I am not vested in this and its yield is not appealing. Its price-to-book ratio is also not attractive at all. But I may just get emotional and get a small stake when there is a chance i.e. the price went down for a while.

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