|
Post by Fletchsmile on May 26, 2015 11:30:48 GMT 7
|
|
|
Post by Fletchsmile on May 26, 2015 11:53:47 GMT 7
I hold a few of the above, although just sold FIRT on valuation grounds, will review and maybe get back in if i can convince myself real NAV is higher than the auditors think, or if i can convince myself they deserve such a high price to book. Yes that's a very valid point on FIRT, Paddy. One of the reasons I'm always happy to share ideas and have other people express their views, which sometimes differ, and can be useful sounding boards. I don't have equal weightings in all those 7, ART, FCT and FCOT are largest 3. The other 4 are smaller holdings. FIRT is one of the smaller ones, for the reason you mention. I like to classify REITS according to: focus or industry / defensive strength / div yield / Weighted Average Lease expiry (WALE) among other factors Being Health care it helps diversify RE sector - and the only one that sector I hold - would like more but haven't found yet. Health I would also rate it strongly defensively if an economic downturn. Div yield is moderate, but WALE is quite high. Then P/E isn't so demanding, so all those 5 things are OK and fit for me. but on price/book or NAV basis it's the highest I hold/ most expensive on assets only basis, and that's the one point why it doesn't get as high and overall weighting. What I also like about FIRT is its growth record and growth opportunities to add. It has potential - as does health sector in a massive country like Indonesia, but also some other Asia countries it's already in. I also think the property book values may be on the conservative side. So overall I like it, apart from the one metric of NAV so gets a lower weighting in holding. Then again none are ever perfect, plus I'm looking at long term holds for these, not trade in and out. What other Singapore REITs do you hold BTW? I'm looking to add a couple more, but takes time to research. So if you have any starting points you've put thru your filters already or are happy with and why would appreciate the input. Cheers Fletch
|
|
|
Post by Fletchsmile on May 26, 2015 12:03:20 GMT 7
Would add that I used to look also for yield > 6%, price/book <1 as key filters/ criteria among others Unfortunately as people have been chasing yields, and have slowly driven prices up, like decent yields on bonds they get harder and harder to find, and obvious bargains aren't as easily found. Then again I'm looking for solid stable yields with these for longer term holdings rather than trading opportunities, so as long as fairly valued and contributes to the portfolio, am not looking for get rich quick opportunities. Still like those two metrics but have to be a little bit more flexible now Won't accept a yield of 5% or under though. 5.5% doesn't hold my attention for long either. The 6%+ yield at portfolio level is still key. Will accept the odd one here and there a bit lower, but need to find an offset that's then higher BTW FIRT's website also has some good FAQ's about REITs for anyone less familiar and interested in REITs www.first-reit.com/ir_faq.html
|
|
naam
Crazy Mango
Posts: 46
Likes: 57
|
Post by naam on May 26, 2015 14:12:08 GMT 7
Naam The ones I currently hold and am happy with + Bberg tickers are: ART:SP - Ascott Residences div yield 6.64% - Hospitality Industry FCOT:SP - Fraser Commercial Trust div 6.05% - Office FCT:SP - Fraser Centrepoint Trust div 5.64% - Retail FIRT:SP - First Real Estate Inv Trust div 5.72% - Health Industry OUEHT:SP - OUE Hospitality Trust div 6.74% - Hospitality I see the above as long term holds and am sat on positive holding gains in addition to the regular divs often quarterly, usually no less than semi-annually Then LMRT:SP - Lippo Malls Indonesia Trust - div 9.86% - again on positive holding gains. Backed by Lippo group which anyone having spent time in Indonesia will know well - yes Indonesia business but Singapore listed, and FX largely removed. The reason I separate it out is they have some debt due for restructuring in the next couple of months, and this will be interesting to see how they do. Don't see a problem, but am just being conservative before adding more. If they get thru OK (not highly leveraged just refinancing) I'll add Lastly KREIT: SP - div yield 5.74% - only one I have a small loss on holding of about 3%, but dividends received and receivable outweigh that. Part of that was Temasek used to hold and depressed the price when they exited with such a large holding The intention with these is to hold - not unlike bonds - and collect the dividends. Capital will fluctuate like bonds, but unlike bonds no fixed maturity and would expect capital growth over time to align with growth in property values All 7 are small SGD 1bn to SGD 7bn in size hence why spreading across several. Also the different sectors bring different defensive qualities/ lease periods etc As Paddy says, you do need to research a bit. But for someone like yourself compared to trudging thru a bond prospectus in full much easier. There's also various decent info around on websites for 3rd part views. Unlike Thai REITs also much more transparent and easier to access info. Will post a bit more later, but run out of time for today... hope that's less "beating about the bush" Cheers Fletch BIG thanks Fletch! but having access to your expert knowledge why should i waste precious time on research? edited for addendum unfortunately 3 out of the 6 mentioned do not "qualify" because our arrogant Swiss bankers, respectively their custodian refuses to provide custody for stocks with a unit price valued less than USD 1.-
|
|
|
Post by Fletchsmile on May 26, 2015 14:19:26 GMT 7
Nice to see the chuckling furry friend - a true hallmark. Does he still have your crystal ball hidden?
|
|
naam
Crazy Mango
Posts: 46
Likes: 57
|
Post by naam on May 26, 2015 14:48:34 GMT 7
Nice to see the chuckling furry friend - a true hallmark. Does he still have your crystal ball hidden? it seems i can work and have success without any crystal ball. another five months like the first five months of 2015 would beat the performance of the best year (2009) in my investor's life. every morning after feeding my dogs and my spreadsheet i am tempted to cash in and lean back, based on "investors sell in may and go away". but then the greed devil whispers in my left ear "why stop now? wouldn't it be nice if you could afford a whole chicken twice a month instead of only once? and wouldn't the dogs be happier if they don't have to steal half their food from the dogs of the neighbours?"
|
|
|
Post by Fletchsmile on Jun 1, 2015 16:15:37 GMT 7
Was doing a bit of research on Singapore REITs today, and came across these on Motley Fool. 2 articles: Why you should and Why you shouldn't invest in REITs. Titles are a bit misleading really and should just say some advantages and some disadvantages of investing in SREITS. But some reasonable high level basics in there: Worth noting that there are more advantages than disadvantages, between the two articles. ====================================================================================================== Why You Shouldn’t Invest in [Singapore] REITs
By Hui Leong Chin - January 30, 2015 | More on: www.fool.sg/2015/01/30/why-you-shouldnt-invest-in-reits/Real estate investment trusts (REITs) have come a long way here since Singapore’s first REIT got listed in the market in 2002. Since then, the number of REIT listings on the SGX has blossomed to a total of 26, in addition to six other stapled securities (a stapled security typically consists of a business trust and a REIT). You can see a listing of all the REITs and stapled securities here. With the number of REITs have grown so much over the past decade, it would be helpful to know what the advantages of investing in REITs are. For this, we can turn to author Bobby Jayaraman and his book Building Wealth Through REITs. Mr. Jayaraman also happens to be the Chairman of the Remuneration Committee for an SGX-listed company, Second Chance Properties Ltd (SGX: 528). For the purpose of this article, I have also used a comparison with buying your own property in Singapore to illustrate the advantages of REITs. Below are some of the tips I picked up from his book: DiversificationAs opposed to buying your own property, REITs can offer wide diversification through the number of properties that they own. For instance, when you buy into a REIT like Capitamall Trust (SGX: C38U), you get to own a small piece of 15 different shopping malls around Singapore. These malls come with more than 3,000 leases from a diversified set of tenants, ranging from the telecommunications industry to the food and beverage industry. Such diversification could be less risky compared to owning just one or two properties on your own. Exposure
Beyond diversification, REITs also offer industry and cross border exposure for the private investor. Let’s take First Real Estate Investment Trust (SGX: AW9U) as an example. Investors in the REIT would have access to contributions from the healthcare industry with 12 hospitals and healthcare facilities located in Indonesia. This lessens the need for the private investor to personally venture into a foreign country in search of properties to invest. Liquidity The lot size change from 1,000 units to 100 units this week also gives the private investor access to REITs at very affordable sums. For example, units of Ascendas Real Estate Investment Trust (SGX: A17U) closed at S$2.52 yesterday. For a REIT that is focused on the business and industrial parks space, a single lot can be purchased for just $252. In contrast, buying a single property is likely to set an investor back by a five-digit sum of money or more. Furthermore, individual properties may be difficult to sell as it takes time to market the property, and then a few more months to run through the transaction process related to the sale. On the flipside, REITs which are listed on the SGX can provide liquidity as it can be sold with the click of a button or two. Distribution YieldPer the Monetary Authority of Singapore (MAS), REITs are mandated to distribute at least 90% of its profits as dividends to enjoy tax transparency. Being a shareholder of a REIT gives you partial ownership to all the real estate that it owns, and the dividend distribution which typically happens every quarter. For instance, commercial real estate owner Keppel REIT (SGX: K71U) reported its earnings on Monday this week. The REIT closed its fiscal year by reporting a total of 7.23 cents in distribution per unit for the financial year ended 31 December 2014. At its closing price of $1.24 yesterday, it would represent a distribution yield of 5.8%. Foolish summary The advantages above are to highlight the benefits that you might get from investing in REITs. But just like any other investment, there are risks to note and due diligence to be done before investing in any REIT.
|
|
|
Post by Fletchsmile on Jun 1, 2015 16:19:31 GMT 7
Some of the things to watch for on buying Singapore REITs... Article is a bit weak really, but some things to consider... ================================================Why You Shouldn’t Invest in REITsBy Hui Leong Chin - January 30, 2015 | More on: www.fool.sg/2015/01/30/why-you-shouldnt-invest-in-reits/I had earlier written an article about why you should invest in REITs. In this article, let’s go to the flipside of REITs and talk about the disadvantages of investing in REITs. As a brief recap: there are 26 REIT listings on the SGX, in addition to six other stapled securities (a stapled security typically consists of a business trust and a REIT). You can see a listing of all the REITs and stapled securities here. Once again, we can turn to author Bobby Jayaraman, and his book Building Wealth Through REITs for hints. Here are some of the tips I picked up from his book: Need for debt and refinancingThe nature of REITs is to retain very little earnings for paying down its loans. This leaves REITs at the mercy of capital markets for refinancing that it needs to do from time to time. The ability and flexibility of a REIT to consistently do so is one thing to watch. Some will do better than others. For instance, healthcare property owner Parkway Life REIT (SGX: C2PU) boasts an all-in interest rate 1.4% and an interest coverage ratio of 10.1 times. Serviced apartment owner Ascott Residence Trust (SGX: A68U) on the other hand, has an effective borrowing rate of 3.0% and an interest coverage ratio of 4.3 times. The differences in debt profile may lie in the underlying business behind the ticker. Growth by acquisition with more debt or share dilutionAt the moment, the level of debt allowed for REITs is capped at 60% of its assets provided that it has a credit rating. Without a credit rating, the debt to asset ratio is capped at 35%. Foolish investors should also be aware that the new REIT regulations proposed by the Monetary Authority of Singapore is a single-tier cap of 45% – with or without credit rating. It may serve to limit the debt levels taken by REITs. However, this also would mean that REITs will likely need to issue more units or take on more debt in order to finance any new acquisitions. The astute Foolish investor will have to comb through previous acquisitions to see if historical acquisitions have been accretive. Track record of management teamsThe REIT you pick may be as good as the ability of the management team to generate organic growth from existing properties, and to execute prudent acquisitions for the future. There is also the matter of management compensation. My colleague Stanley has pointed out differences before: CapitaCommercial Trust (SGX: C61U) has one of the lowest fees, with only a 0.1% base fee. Most REITs such as Keppel REIT (SGX: K71U) and Ascendas Real Estate Investment Trust(SGX: A17U) have a base fee of 0.5% of the total asset of the REIT. REITs such as Mapletree Greater China Commercial Trust (SGX: RW0U) and OUE Commercial Real Estate Investment TR (SGX: TS0U) set its performance fee to the increase in DPU from year to year, motivating the managers to focus on growing the DPU for its unit-holders. Ultimately, the private investor will have to judge the performance of the management team against its compensation. Foolish summary The points above are to highlight some of the downsides from investing in REITs. Like any investment vehicle, there will be advantages and disadvantages associated. The points shared should not distract us from the overarching importance to picking good businesses underlying in the REITs.
|
|
|
Post by Fletchsmile on Jun 3, 2015 9:34:12 GMT 7
I came across an interesting fund in Thailand today, while researching property funds and REITS. From TMB on their open architecture platform. The fund was launched in June 2014
It appears to combine Thailand property funds, Thai REITS and Singapore REITs. The benchmark is 50% Thailand Property Fund and Index 50% FTSE Straits Times REIT index (Singapore).
Interesting as:
- As far as I know in Singapore there isn't a fund or ETF of Singapore REITs. I've wanted one but couldn't find - The combination of Thai and Singapore is very interesting to me, as I find Thai REITs not as easy to find decent info on, too much in Thai language etc (which although I can read, I don't have the patience unless I really need to as it takes me 4 times as long as English!). A spread across different funds would reduce risk though, and combining with Singapore is a big plus - It also includes FCT:SP which I hold and have mentioned in this thread = 5% of the fund is invested - It pays dividends = income - Might be the type of thing I could buy in my wife's name, and she could just hold collecting income if anything happens to me
I need to find out more on it, and the fact sheets/ info sheets are limited, and only show top5 holdings plus key overview details. But may be of interest to some
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jun 3, 2015 11:26:53 GMT 7
The following site (in Thai) has a list of the top 10 holdings (and is more up to date than the TMBAM factsheet you attached). It also reveals that 25% is held in cash which I find a bit odd. The fund was launched at the end of June last year, so I would have expected it to be fully invested by now. Apart from that, on first inspection it appears very interesting - the sort of thing I've been looking for for a while. www.thaimutualfund.com/AIMC/aimc_fundProfile2.jsp?id=02212557
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jun 3, 2015 11:59:46 GMT 7
Just one other bit of information: Bloomberg is giving the yield as 6.08%.
Not sure if the currency risk is hedged, but a holding of 0.54% in derivatives suggests it might be. However, the list of risk factors includes currency risk.
|
|
|
Post by Fletchsmile on Jun 3, 2015 12:01:57 GMT 7
Thanks for the link AYG, that further breakdown is useful. That covers just over half for top10, instead of just over 1/4 for top 5 I had originally.
6 are Singapore, 4 Thai in their top 10
So looks like nearly 14% of their holdings is in my 3 largest S-REITS holdings: ART,FCT and FCOT, that I mentioned on this thread.
Nice also to know that all 3 are in their top 10/ top 6 Singaporean - adds some additional comfort to my largest holdings.
For the other S-REITs: - MINT and CD REIT, I'd looked at recently, and was considering, - CT, I'd also lokked at and dismissed, as it didn't appeal, as the yield is about 4.9% and price/ book 1.19 which isn't attractive
On the Thai ones, they look some of the better quality property companies/REITs
-------------------------------------------------------------------- Invested assets 10 (sorted by descending value). As a percentage of net asset value (% of NAV) as of March 2015. 1. Tisco Bank Plc. (TISCOBAN) 6.86% 2. TESCO LOTUS RETAIL GROWTH FREEHOLD AND LEASEHOLD PROPERTY FUND (TLGF). 6.48% 3. CPN RETAIL GROWTH LEASEHOLD PROPERTY FUND (CPNRF). 6.22% 4. CapitaMall Trust (CTSP) 5.24% 5. Frasers Centrepoint Trust (FCTSP). 5.12% 6. CDL Hospitality Trusts (CDREITSP). 4.97% 7. IMPACT GROWTH REAL ESTATE INVESTMENT TRUST (IMPACT). 4.89% 8. Frasers Commercial Trust (FCOTSP). 4.50% 9. Mapletree Industrial Trust (MINTSP). 4.32% 10. Ascott Residence Trust (ARTSP). 4.10%
|
|
|
Post by Fletchsmile on Jun 3, 2015 12:14:18 GMT 7
I like the look of this so far on balance for family objectives. One thing I continue to work on is simple income generating funds I could just leave in my wife's name in case something happens to me or for simple no hassle investing from Thailand when I can't be bothered any more. This could be a nice part.
A key disadvantage is the total fees and expenses at 1.19%, and a front end fee of 1%. Particularly when I can and do buy S-REITs directly on SGX for under 0.2% brokerage (compared to initial fee), and no custody/ongoing annual fees.
OK I could save fees while I actively manage and am around, but for someone like the Mrs who has no clue and Thailand based, that's where the interest us.
So where it would come into its own though is being able to buy from Thailand, and then hold long term, as something that pays income, plus the diversification and convenience
The BB yield of 6% ish sounds reasonable based on knowing what the S-REIT yields above are. So once set up it would be a net return of around 4.5% to 5% after charges from property with some potential for capital growth.
|
|
|
Post by Fletchsmile on Jun 3, 2015 12:19:52 GMT 7
Just one other bit of information: Bloomberg is giving the yield as 6.08%. Not sure if the currency risk is hedged, but a holding of 0.54% in derivatives suggests it might be. However, the list of risk factors includes currency risk. For me I wouldn't worry too much on the currency exposure. I like SGD. Correlates reasonably to THB and over the couple of decades I've held both, SGD has fared better. So no real issue. BTW Saw on the dark side you asked about holdings for a pensioner in Thai equities - unfortunately there were then a lot of posts that caused to lose interest. These are exactly the reasons for holding THB denominated assets and the type of things I would hold here in Thailand for someone based here who is less experienced, or people like my wife, I could leave and manage if I'm not around. Will probably start a thread on investment portfolios for spouses/ retirees/ just leave and hold in Thailand at some point. I have a few in mind, and this fills a gap. Doing from Thailand via mutual funds is not necessarily the cheapest option. But can be very convenient, even if a little more expensive Cheers Fletch
|
|
|
Post by Fletchsmile on Jun 3, 2015 13:29:22 GMT 7
There's also a Retirement Mutual Fund (RMF) version of the fund. The difference to the basic fund would be: 1) you could get tax relief on your investment in the RMF at your marginal rate of tax up to 35%. So a THB 1,000 investment could cost as little as THB 650 for someone working and earning in Thailand. That's a 54% uplift on your investment of THB 650, as long as you keep til your 55. 2) There's an extra 0.5% p.a. fee (hate it when they do that); but no up front fee according to the fact sheet 3) You can't received dividends on it as it would then breach retirement mutual funds (pension fund) rules of not accessing returns before 55 years old www.tmbam.co.th/pdfs/rf4_03_en.pdf[Shame I didn't see it before as I've already maxed out my RMF allowances this year, in: global equity + thai equity + global bond + gold funds to get the tax relief. Would have been nice to add property to the mix]
|
|