Posts
I have been busy gaming in the last few days as Neverwinter celebrates its 10th birthday.
Time really flies and I have been adventuring in virtual worlds for 8 years.
Of course, I have been retired from gainful employment for just as long.
I remember saying that CPF is a pie we would all get to eat one day if we did the right things.
Well, in another 3 years, I would get to eat the pie.
It is both a happy and depressing thought.
Anyway, like I shared in my last blog, I ignored AA REIT's rights issue.
It meant accepting an 11% reduction in income from the REIT in future.
I am staying invested in AA REIT but as a retiree without plenty of excess funds, I am less willing to deploy money into any venture that does not add to my income in the very near future.
Even if I were to take up my rights entitlement, unless I am willing to apply for a lot more in excess rights, I would still suffer some income reduction from the REIT.
Much better to put the money in T-bills in my case.
This provides a nice segue into the next topic.
My non-competitive bid for the recent 6 months T-bill was 100% filled.
3.89% p.a. huat ah!
Could have been higher but it is obvious that many kiasu people were placing very low bids of possibly under 2% p.a. in order to secure their T-bills.
Proof is in the pudding with average yield at a paltry 3.07% p.a.
I saw that and it was a face palm "Alamak AK!" moment.
I have no words.
Speechless.
OK, I stop.
Another "Alamak AK!" moment was DBS and OCBC being fined $2.6 million and $600,000 respectively by the Monetary Authority of Singapore.
It is a ton of money to AK but it is probably like being stung by a mosquito for the banks.
I am staying invested in DBS and OCBC, of course.
Still looking to add to my investment in OCBC and UOB at supports.
Hint: OCBC tested immediate support which has risen to $12.30 a share just now.
Longer term support for OCBC is still around $12 a share.
I would add to my investment in DBS too but its stock price would have to decline much more for it to be attractive to me.
Nothing to see here, move on.
I am gathering my funds to take part in IREIT Global's rights issue now.
Must pay by 11 July.
If I am successful in getting all the excess rights I aim to get as well, IREIT Global could become an investment as big as my investment in OCBC.
Yes, I am emptying my war chest for this.
This is an exciting thought but also a scary one.
I might have to do some rebalancing of my portfolio later on.
For now, I just like the idea of increasing my income from IREIT Global by at least 16%.
That's all for now.
If AK can talk to himself, so can you!
Related posts:
Bloggy Award
32 comments:
Hi ak,
My first time participating in rights issues, when can i apply for ireit's rights issue?
Hi HuatBigBig,
All shareholders will get a package by snail mail with the details soon.
However, we can get guidance from IREIT's website in the meantime.
https://investor.ireitglobal.com/news.html/id/2445804
Exercise period: 03/07/2023 TO 11/07/2023
So, last day to make payment is 11 July.
Hope you huat big big! :D
Hi AK,
Other than AIMS APAC & IReit, can you talk to yourself about Sabana Reit if it is still
a good stock to buy. Thanks!
Hi DennisRoger,
I have talked to myself about Sabana REIT from time to time.
For examples:
Sabana REIT: Closer to 52c NAV.
and
Offer of 46.5c per unit by Volare Group.
There is still a lot of value which can be unlocked in Sabana REIT.
Even if no AEIs or redevelopment happen, the REIT is still under rented.
I see no compelling reason to sell at the current price level.
Hi AK,
If ireits rights is at $0.408, why does people still buy at $0.445 (price today)?
Thanks.
Hi Jessica,
Even before 40.8c was announced, IREIT Global found support at 44.5c per unit.
Simply put, IREIT Global offers great value at the current price.
So, I won't be surprised if there are value investors with deep pockets who are loading up.
They would also be able to increase the number of rights units they are entitled to in the process.
That would allow them to buy even more at 40.8c a unit.
So, they will get a distribution yield of 8% to 8.8% from income generated by predominantly freehold properties in Germany and France.
Then, there are also newly minted IREIT Global shareholders who are buying some now in the hope of getting more excess rights later on.
I have a feeling that it might be harder to get a meaningful number of excess rights because most will try to get as many as they can due to how attractively the rights units are priced. (TmT)
Hi AK,
What's your thoughts about Sabana's EGM? How will this "fight" affect the REIT?
https://sg.finance.yahoo.com/news/requisition-notice-egm-remove-manager-060352492.html
Hi DL,
Apart from replying to the question from DennisRoger in this comment section, I also replied to another reader, Zhang Zheng, on this specific issue of removing the external manager.
You will find the exchange in the comments section of the following blog:
Offer for Sabana REIT by Volare Group.
Business as usual. ;)
If you had exercised the rights issues, the yield is around 8 percent (better than the T-Bills). At the same time, you might have capital gains if the price goes beyond 1.189, which is even better. Can talk about this.
Hi ngs,
You will find the answer in my reply to Yv in the comments section of the following blog:
Ignoring one and buying more of another.
As for the future direction of AA REIT's unit price, it could go up or it could go down.
Your guess is as good as mine. ;p
As for 8% distribution yield being better than T-bills' yield of under 4% p.a., that is not a like for like comparison.
Arguably, AA REIT is a riskier investment compared to T-bills. :)
Hi AK,
I have purchase IREIT using my SRS account. Will it be entitled for the right's issues?
hi AK,
sorry, first time doing preferential shares
it says ex date is 26 and record date is 27 at 1700hrs.
Does it mean that I can buy preferential shares based on what I have on hand on 26? or 27 before 1700hrs?
And then they will snail mail to us by 3rd and we have to apply for it before 10th and pay on 11th?
Hi Ak, is there another way to apply for rights issue instead of via paper mail?
Hi E,
XR date means that whoever buys the shares on that day and thereafter is not entitled to rights units.
So, our rights entitlement should be calculated based on whatever we hold prior to that date.
As for snail mail, it depends on how fast Singapore Post does the work too.
I usually receive the package 3 to 4 days before the closing date.
I would do the application and payment together on the same day at a DBS ATM usually.
And I wouldn't wait till the last day. ;p
Hi CupcakedCrusader,
I always apply and pay at an ATM.
I believe there is an option to pay with a cashier's order but I have never done it before.
Someone told me there is a new way to pay for rights units using banking apps but I have not tried it before either. ;p
So, in this case, I would just go to an ATM two weeks from now. :)
Hi AK, I missed your fan meet session but nevermind. I read your blog now and then, and also watch your Youtube with my son. Lol, have to say I am more of a reader. Hope you doing well..
For applying and paying for rights, can also do by SGX.com if the rights are in your CDP account. Think payment is by QR code Paynow/Paylah! If held by custodian like FSMOne, can also apply in their site.
hi ak,
do you know when we should expect results on our application for excess rights? how are we notified of this? and when/how refund of money if excess rights applied for were not granted. I understand that for aa reit the new units are to be listed on 3rd july.
Hi TASM,
I also say never mind. ;)
It was just a lot of chit chatting and photo taking. ;p
Thanks for letting me know that you like reading more which seems to be the case for most people listening to me talking to myself.
Oh, so the person who told me about paying for rights using banking apps is right? Scan the QR code with our phone? So advanced! Thanks for sharing this. :D
Hi zhenling,
A long long time ago, I would simply wait for a snail mail advice from CDP.
A faster way was to check for refund of money in my bank account a few days after the deadline for paying for the rights.
From there, I would calculate how many excess rights I got.
These days, we can check our CDP account online if we hold the shares directly and not through a custodian.
Technology so advanced. AK blur.
Hi AK,
Thanks for sharing your thoughts about the rights issues of AAreits as well as iReits.
One question i have on my mind about the rights issue from iReits, they didnt declare any pro-rated dividend upon releasing the pref shares details.
Isn't it compulsory to pay out the dividends on the existing shares pre rights?
Thanks again.
Hi nch,
The reason why AA REIT did that and IREIT didn't was because AA REIT had a private placement.
Naturally, new shareholders should not be entitled to dividends for months prior to them becoming shareholders.
So, pro rated dividends are paid to pre-existing shareholders.
IREIT does not have this problem since only existing shareholders are offered new units
IREIT did not have a private placement.
I much prefer 100% rights issues to private placements as the latter dilute existing shareholders' stakes as seen in AA REIT's recent equity fund raising exercise.
Hi AK,
Do you go to AA REIT AGM?
Hi DL,
I am usually too lazy to attend AGMs.
The only one I can remember going to was Saizen REIT's many years ago.
Hi AK,
Do you still a strategy on applying for the rights, for example how many in excess you will try for? Thanks.
Hi MK,
Well, it would depend on what is being thrown at me.
I blogged about this a couple of weeks ago.
See:
Ignoring one rights issue and buying the other.
YouTube chat regarding IREIT Global.
benk7177 says:
I believe in the longer term growth prospects as it rides through the economic volatility🙂. But what do you think would be the near term catalyst for price to trend upwards again.
AK says:
I have no idea if price would move up or down.
I do know that there is some clarity when it comes to income generation. 😄
Having said that, I suspect Mr. Market is worried about the Berlin asset.
The master lease is expiring next year. Will just have to wait and see. 🤞
Hi AK,
Another Germany property with expiring lease! Do you expect lower DPU?
Do you think IREIT business update is rather simple and short than other REIT?
Hi DL,
The business update is pretty straight-forward and covered the salient points.
Good enough for me.
The Berlin office market is pretty resilient with vacancy at around 5% and the Berlin asset is currently under rented.
I believe that the Berlin asset will be able to generate a higher income in due course.
Of course, if the lease is not extended, we must expect a period of lower income.
Hi AK,
Looks like a good news for the Berlin asset. 16 months to look for replacement tenants.
https://investor.ireitglobal.com/news.html/id/2448215
Hi DL,
The most important thing is that it gives clarity as to what the Berlin asset is truly worth. :D
We discussed this in the comments section of this blog:
IREIT's rights issue 134.7% subscribed.
happy, got 100% of excess rights applied :)
Hi garyp,
Gong xi gong xi!
Me too!
Makes me happy! :D
Post a Comment