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High yielding REITs.

Monday, August 9, 2010

I came across an article which reported Morningstar analyst John Coumarianos saying "I guess people are so exasperated with earning nothing on money market [funds], so they're opting for the 2 to 3 percent [yield] that they're getting on a REIT fund".


This is a reference to the situation in the USA.  2 to 3 percent yield? That's peanuts compared to what we are getting from REITs in Singapore!  I mentioned before that a 5 to 6 percent yield in a REIT is not enough to attract me because I can get an almost 10 percent yield in some REITs here. I think investors in REITs here are spoilt!

After the subprime mortgage crisis, all types of real estate investments were punished. Many experts thought that commercial real estate would be the next big bust. "The headlines were all so bad with the housing market," Sorensen says. "REITs don't have a ton to do with the housing market, and expectations there were so depressed. The reality has been better than expected."

Read the article here.
Will the REITs Rally Continue?
, On Thursday August 5, 2010, 11:43 am EDT

Related post:
Create more passive income with limited capital. 

5 comments:

Anonymous said...

You have a valid point. We are indeed spoiled for choice... Let's enjoy the good times while they last!

Gaudente said...

I think investors in Frasers Commercial , Indiabulls, Seizen, just to name a few , have been ruined rather than spoilt

AK71 said...

Hi Gaudente,

I am not sure about Indiabulls but for Saizen REIT and AIMS AMP Capital Industrial REIT (formerly MI-REIT) it would depend on when these investors made their investments, I suppose. ;)

left_ray said...

I bought Fraser at 1 dollar, but I applied rights share and even got my excess rights share at 0.095. So I was able to average down to 0.276. Saizen, AIMS, and IndiaBulls have all issue rights to raise money. As long you applied rights, you are down but not yet ruined.

But IndiaBulls was a strange IPO. It's property, IndiaBulls, was expected to complete construction at 30/06/08, but the IPO starts at 02/06/08. My goodness! Projection DPU is 9.82 cents for 2010 and I still not seen any cent declared. Anyway, I don't follow it quarterly since I don't have it.

AK71 said...

Hi left_ray,

You are right, of course. We should always have some reserves in case our companies or REITs in this case come with hat in hand for more funds. This will ensure that our stakes would not be diluted.

Actually, I have always wondered at the reason for choosing such a name as IndiaBulls. ;p

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