Distribution Reinvestment Plan: First REIT and CIT.

I received a few enquiries from readers as to what I am doing with regards to the Distribution Reinvestment Plans (DRP) offered by First REIT and Cambridge Industrial Trust. I think readers who have been following my blog for a long time would have guessed my answer.

I invest in REITs for income and I will take the distributions in cash, usually. Usually? Yes, usually and I would have said "always" if not for the single instance when I took part in the DRP of AIMS AMP Capital Industrial REIT's.

So, why did I do it then? Was I being inconsistent?

Well, if I could make money out of a situation and yet not stray from my original intention of investing for income, I am being consistent. That was the case then. So, it was a case of having my cake and eating it too. Why wouldn't I do it?

For those who are unfamiliar with the circumstances surrounding the DRP I am referring to, please read: AIMS AMP Capital Industrial REIT: DRP.

As for the DRPs offered by First REIT and Cambridge Industrial Trust now, I don't see how they are compelling offers apart from the fact that unit holders who take part will be saving on brokerage fees and other costs which would be incurred if they were to make the purchases in the open market instead.

First REIT is offering to allot new units at a price of S$1.0163 per unit. Market price is now $1.02 per unit.

Cambridge Industrial Trust is offering to allot new units at a price of S$ 0.6737 per unit. Market price is now $0.68 per unit.

As anyone can see, there is only a very slight discount to the current market price in both cases.

So, unless we are thinking of increasing our exposure to the REITs at current prices anyway for some reason, it would not make much sense to take part in the DRPs.

I have shared the reasons why I am not adding to my investments in S-REITs in earlier blog posts but those reasons are good for me. They might not be good for everyone.

Having said this, I still think that REITs are relevant investments for income and would not hesitate to add to my long positions if Mr. Market were to make me offers too good to refuse.

Related posts:
1. 9M 2013 income from REITs and more.
2. 2013 full year income from S-REITs.
3. Strategy to grow wealth and augment income.

A pleasant surprise from Nuffnang.

Today, I received a pleasant surprise from Nuffnang. I got a cheque from them in the mail!

Almost one year's worth of ad income from Nuffnang.

Although the amount is lesser than what I expected to be paid when I made the cash out more than 2 months ago, it is better than not being paid at all. Am I good at consoling myself or what?

A good sign, you think?

Gong Xi Fa Cai! Wan Shi Ru Yi!

Related post:
Accused of fraud and denied payment.