can your REIT dividend cover your cost of financing+

I shortcut too much, sorry for misleading.

What I mean was, when I decide on whether the reit's yield is good(cheap) or not(expensive), I normally look at both the yield and its NAV, in addition to its properties type (be it retails, factory, hospitality, hotel etc.)

ie.
I don't mind to pay a little premium for strategic location retail properties because of its defensive attribute. Meaning, even if the yield is 7.x, I'm fine with it as long as its price/NAV ratio is not more than 1.0.

As for hotel play, since its business highly depends on economic sentiment, I can only accept if its yield is above 7.0 with price/NAV ratio of 0.80 or below. So that at least I know I'm buying at a 20% discount price, that is at a safer zone for the price to drop further when economy goes wrong.

For office/industry/warehouse play, i prefer to get yield of 8.0 or above with price/NAV of 0.90-1.0. As it's a mix of defensive and risk. However, Axreit is a different case. It's too good in stable growth, I won't mind to pay some premium.

I understand most investors don't care about NAV for reits play, and I respect their thoughts. However, I still care. I think if the company got so much value of properties(higher properties price normally comes with higher rental fees), if the management is not too bad, any downside of rental received would be just temporarily.

Just my view lah.

Let say I have RM100,000 ~ I invest all in Starreit... dividend 7%
then every year can get RM7,000 x 2 = RM14,000 per year ??

i sell all my assets to buy if this is the formula....the 7% is per annum.... so RM 7000 is the answer but the 7% is not fix... may change from time to time depend to the rental receivable - management expenses...... right?

Wow.. If I have RM1million...then i no need work ady... 7% dividend...
1 year RM144,000 !!
then second year the money keep raise !! after 50 years old...can becum Buffett 2 !!

say u invest 100k get rm7000 a year which is 7% return, who know next year rental drop to rm6000, then your shares will drop too.

Drop or not... But the point is..can get high Dividend !! BETTER THAN FIXED DEPOSIT !! Cheers !!

7% per annum how to get 14,000?

RM100,000 + 7% = RM7000
1 year 2 times dividend = RM14,000
Got it ??

Your calculations means 14% p.a. not 7%.
Yield calculation are an annual thing. So usually, if div is given twice a year. Its probably 3.5% each time. (so whole year = 3.5% + 3.5% = 7 %)

This post has been edited by whizzer: Oct 28 2010, 12:34 AM

happy-hours read:



Attached File(s)
 Arreit.pdf ( 72.86k ) Number of downloads: 72

Hi
Read somewhere that KV office supply will increase ~30% next 2years. Maybe oversupply & hence downward pressure on the office rental market.
However supply for MSC status buildings are still very limited with high demand. Hence rental should hold quite well.

anyone knows what % of QCAP rental is derived from buildings with MSC status? thanks

For REITs investor, a five-year exemption from withholding tax will be implemented soon under the Government's new initiative to encourage growth of the sector. However, the date for the implementation is yet to be announced. Well, think will be implemented by end of next year? , since the current 10% policy will expire by end of 2011.

May refer to the website below for more details.
http://www.pemandu.gov.my/index.php?option...emid=83&lang=en

Plus, more REITs will be announced soon, hope more thorough research and incentives would be given to revitalize this sector ^^

This post has been edited by Maxsimax: Oct 29 2010, 08:59 AM

I didn't know the REITs 10% policy is not a permanent policy? that means if come next year it is not renewed, all REITs revert to company tax? unless a new 100% waiver takes effect?

Yup..

nope, whizzer are correct...

Too many to read there. Can please point out where it is?

I won't worry on too much on this, as there is likelyhood, something implemented, if will continue to go on especially when your neighbour country is under tax exempted policy.

REIT worth to buy and hold ??
1 year 3.5% + 3.5% = 7 % per year...
abit low !!

time to continue buying Reitsssss...