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Dumping One REIT for Another

I have been thinking of liquidating my First REIT to another REIT.

First REIT has served me well over the years but as its price has gone up quite a fair bit, I feel compelled to ditch the passive income it has been giving me over the past 2 years and to lock in some gains.

This is especially so because First REIT's share price is quickly riching its Net Asset Value.

I am not expecting First REIT share price to exceed its NAV as that has not happened before (correct me if I am wrong).

What I like about First REIT:
1. Good stable dividends that are slowly growing
2. Super Defensive as it is in the hospitality sector
3. Good gearing

What I don't like about First REIT:
1. Highly focused on Indonesia
2. No big "sponsor"
3. Trading close to NAV

The decision whether to cash out or not will ultimately depend on whether I can find another REIT or high dividend yielding stock to purchase. I have been thinking about Cambridge Industrial Trust but it seems that after the takeover debacle, their price might still trade at significant discount to NAV for some time..

Decisions, decisions, decisions
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4 comments:

  1. AK71January 6, 2010 at 9:02 PM

    First REIT has a big sponsor, Lippo.

    Cambridge Industrial Trust has very high gearing. I would not rule out future recap exercises. The former MI-REIT is a better choice with the lowest gearing amongst industrial property trusts in Singapore now. I've blogged about this:

    http://singaporeanstocksinvestor.blogspot.com/2009/12/aims-amp-capital-industrial-reit-mi.html

    ReplyDelete
  2. financialfreedomJanuary 7, 2010 at 12:42 AM

    Yeah .. CIT has high gearing

    But MI REIT also issuing rights...

    ReplyDelete
  3. AK71January 7, 2010 at 4:44 PM

    MI REIT's recap exercise is over. They now have the lowest gearing amongst industrial property trusts in Singapore. It has been renamed AIMS-AMP Capital Ind REIT.

    ReplyDelete
  4. AnonymousJanuary 8, 2010 at 12:54 AM

    Thanks for the update.

    I sold off my First REIT already. All 17 lots of them

    ReplyDelete