Asked on 07 Jun 2019
I want to see what parameters people use to evaluate reits
The REIT that I always want to buy will be Mapletree Commercial Trust. MCT owns Vivocity which is the largest shopping mall in Singapore.
For parameters, I usually look at P/B ratio, dividend yield, quality of the assets such as occupancy rate, WALE etc.
For P/B ratio, I am comfortable in buying any quality REIT that is 1.10 and below. Dividend yield for me must be mlre than 5%. Occupancy rate must be high and stable over the years and WALE must be long too. However, not all REITS have long WALE as it depends on the industry the REIT is in.
Other than that, I will also look at the historical distribution, I prefer REITS to give higher or stable distribution every year.
CMT! CapitaMall Trust!
Low debt, growing yet sustainable dps, prudent management with good track record
A few REITs I would recommend right now would be Ascendas REIT and MIT/MCT.
-For A.REIT, when it falls around the 2.93 region, though it is at around a 1.3 PB ratio, I feel like it's still a valuable REIT to hold onto !
-For MIT and MCT, just consistent growth throughout, but try to enter at a good price !