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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Good morning 5i Team

I currently have a half position in BPY.UN and have been looking for an opportunity to increase it to a full position (3.5%). I'm primarily interested in dividend income (I like BPY's 7%) supplemented with some growth. I tend to hold dividend payers for long term.

I would have thought lower interest rates would have been a tailwind for three reasons:
1) dividend income versus alternatives
2) lower cost of borrowing
3) lower cap rates for properties for sale, increasing potential sales price (offset by recession risks lowering demand for same).

Interested in your comments on this.
Thanks as always.
Peter
Read Answer Asked by Peter on July 12, 2019
Q: Hi,
What would be the best ratios to look at before buying a REIT : FFO, P/B , EV/EBITDA ?, …For example CUF has good ratios (may be because the price is down) but is far from a favorite among analysts. I have small positions in AP, HR, REI, PLZ, TCN. I sold SRU. I also have VNQ Etf, WIR, HOT and IVQ on the US side. The last two did not perform very well, but seem OK and have quite a big yield. Are my holdings a good mix or too diversified ? I find the REITs are historically expensive right now (ex IIP, DIR) and I’m hesitant to put more money in this sector. Thanks
Read Answer Asked by Denise on July 05, 2019
Q: Hello and thank you for your exceptional service. I am retired and dividends and other distributions are a necessary part of my income. In an environment such as we currently live in without inflation and with historically low interest rates. Aren't REITs a valid alternative to bonds and GICs? I own 15% in GICs, no bonds and I'm currently overweight at 9% in Real estate and wonder if my strategy is correct in your opinion. Should I remove some REITs exposure, which would you trim first and in what order from the list above. Where would you put the money instead? Thank you.
Read Answer Asked by Yves on July 04, 2019
Q: How do the above Reits differ in asset allocation, rate of return and fees?
Read Answer Asked by Lorraine on July 02, 2019
Q: I don't see any questions yet on the recently announced buyout of Pure. Kind of odd, I thought. For myself, I had a fairly sizable investment in this one and sold off almost as soon as the offer was announced. I felt that Pure has had ample time since the last offer from this same company to find a better offer and doesn't appear to have yet. Kind of taking a bird in the hand rather than two in the bush. What's your opinion on this?
Read Answer Asked by Larry on June 28, 2019
Q: Allied Properties had an equity offering on June 10th and since the initial drop, has in my opinion, shown some volatility and is down about 2.5% today. All of this is probably not outside what could reasonably be expected but I wonder if you have any news, insight or comments. Other REITS/Trusts have fared better with equity offerings very recently.
Read Answer Asked by James on June 28, 2019
Q: I’m very confused with the movement in Tricon’s share price despite beating analyst expectations and generally performing well financially for years it seems to only trade sideways. I’ve also noticed that the REIT sector has broken out as a whole (ex. XRE) but Tricon can’t catch a bid. I know the business isn’t quite the same but I’ve heard analysts make analogies to Brookfield and Blackstone and yet the share price just goes sideways. What gives? Also would Tricon be an attractive take out for Brookfield or some other private equity? Thanks
Read Answer Asked by Scott on June 21, 2019
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