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  5. CHP.UN: Just wondering if you are still comfortable with this REIT. [Choice Properties Real Estate Investment Trust]

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Q: Just wondering if you are still comfortable with this REIT.

Have been looking for a commercial property REIT for purposes of diversifying holdings away from multi-family. And I know Choice acquired the old Canadian REIT years ago, which I thought to be of very high-quality at the time.

Choice appears to have less risk due to its size (705 investment properties) and the loan to value ratio appears commensurate with peers.

However, there seems to be a huge number of equity units outstanding after factoring in the exchangeable units. As well, what really appears unusual for CHP.UN is that it trades at a significant premium to NAV whereas most entities in the Canadian REIT universe currently trade at a discount to NAV.

Thank you
Asked by Brad on May 17, 2024
5i Research Answer:
While the outlook for commercial properties is still somewhat uncertain, CHP.UN we think would...
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