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.

Thursday, January 15, 2015

Analysis of Sabana REIT

Current Price on 8th Jan 2015 = $0.92
  • Yield = 7.87%  
  • Price-to-book Ratio = 0.84
  • Assets per unit = $1.87
  • Debt per unit = $0.774 (including current liabilities)
  • Secured NAV = $0.257 (28% of trading price)
Sabana REIT has been dropping in its trading price to the current price of only $0.92. I suspect they have issues with occupancy which has been decreasing quite drastically. With this trading price, here are the statistics.

Yield is at 7.87% which is still at a high compared to other REITs, considering that they are only 91% occupied. Moreover, they are priced at a 16% discount which I think is reflecting on the situation that they are in. But valuation, to me, should still be trusted as they are revalued every year. Imagine someone giving you a 16% discount to buy a property.

Sabana REIT has increasing become a strong competitor for my investments along with Viva Industrial Trust and AIMSAMP Industrial Trust with high yields. Of course, Viva Industrial Trust have a forward yield of more than 9% in my earlier post so I am keeping that. AIMSAMP Industrial Trust seems to be losing flavour as Sabana REIT beats them both in yield and in Price-to-Book ratio. The question now is only whether the transaction cost is worth the switch.

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