S-REIT Investment Blog: Analysis of Soilbuild REIT

Welcome

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, October 22, 2015

Analysis of Soilbuild REIT

Current Price on 17th Oct 2015 = $0.785

Yield = 7.88%
Price-to-book Ratio = 1.034
Assets per unit = $1.300
Debt per unit = $0.502 (including current liabilities)
Gearing = 38.6%

SoilBuild REIT has published their results which in my opinion, shows a lot of resilience in their portfolio and renewal of leasing. Here are the results.

Yield is at 7.88% which just miss my 8% yield criteria. Price-to-book ratio is at 1.034 which means we are buying at 3.4% premium for this portfolio of properties. Gearing is at 38.6% which is still healthy.

In their report, it was shown that about 26% of their NLA is expiring. At the same time, 784,000 sqft of space is leased out already and this is more than 20% of their NLA with slight increase in rental. It means that they are not going to suffer from a big drop in their occupancy which helps to maintain their DPU.

Having said that, I believe that it is already priced in. With the yield and price-to-book ratio both not hitting my criteria, I am not investing it although the fundamentals are good. (I realize that I am a bit more of a risk-taker than conservative)