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 17, 2015

Analysis of Viva Industrial Trust - Trying to grow in challenging conditions.

Current Price on 8th Aug 2015 = $0.765
  • Yield = 9.81%  
  • Price-to-book Ratio = 0.93
  • Assets per unit = $1.464
  • Debt per unit = $0.642 (including current liabilities)
  • Gearing = 43.8%
  • Credit Rating = BB
Viva Industrial Trust has been making a lot of news recently. They purchased two properties, have one major asset enhancement and now announcing another two acquisitions. The above statistics are an estimate which is from their recent report + proposed acquisitions, (which means it exclude the asset enhancements)

Their yield is probably the highest you can find in REIT market. Only IREIT Global is higher but Viva Industrial Trust's properties are all local so you can see the physical property plus it is easier to monitor the economic conditions as being a Singaporean, it is natural to be more aware of local conditions. Price-to-book ratio maintains at 0.93 which means we are buying at a discount. If their asset enhancement is a success, valuation may go up further. Thus, according to my indicators, they are good for long term.

One thing to note is that they need to raise cash again to purchase these properties. While I am neutral to raising cash, I don't like it to have private placement as it is not beneficial to existing investors (they did it in once this year which I manage to participate). I prefer a rights issue for all investors which is fair. This piece of news should come soon, later this month.

I am heavily vested in Viva Industrial Trust (79,100 shares worth about $60,000). Was thinking of paring it down by a bit so as to reduce exposure but then I need to wait for the right price to unload and another opportunity as well.

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