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FirstService Corporation (FSV)
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InterRent Real Estate Investment Trust (IIP.UN)
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Dream Industrial Real Estate Investment Trust (DIR.UN)
Q: Hi Peter, Ryan, and Team,
In the Real Estate sector, and across all our accounts, we own DIR.UN, FSV, and IIP.UN. FSV has been a stellar performer, and without 5i’s initial recommendation, it wouldn’t have been considered, and is certainly one we want to keep.
However, when I look at the charts for DIR.UN and IIP.UN, I see that Dream Industrial has a much better long-term record. Does a residential real estate stock need to be owned in one’s portfolio? If IIP.UN isn’t really necessary, I’m considering selling it and putting the proceeds into DIR.UN. Both IIP.UN and DIR.UN have made money, but of course, Dream has made a lot more.
Your comments, as always, are greatly appreciated.
In the Real Estate sector, and across all our accounts, we own DIR.UN, FSV, and IIP.UN. FSV has been a stellar performer, and without 5i’s initial recommendation, it wouldn’t have been considered, and is certainly one we want to keep.
However, when I look at the charts for DIR.UN and IIP.UN, I see that Dream Industrial has a much better long-term record. Does a residential real estate stock need to be owned in one’s portfolio? If IIP.UN isn’t really necessary, I’m considering selling it and putting the proceeds into DIR.UN. Both IIP.UN and DIR.UN have made money, but of course, Dream has made a lot more.
Your comments, as always, are greatly appreciated.
5i Research Answer:
The industrial sector has been a better REIT sub-sector, with growth from data centres and general industrial customers. Residential REITs have lagged with less growth, higher interest rates and reduced ability for rent increases, with squeezed consumers. We still like IIP.UN for growth. Is it necessary? Probably not. If an investor is comfortable with less diversification we would have no objections to the plan outlined in the question.