Looks like ARREIT is gonna underperform for a while?

The dilution effects and the psychological impact of the cheaper placement price.

You think so?

If they don't put the RM519m to good use, we're looking at a 33% dilution to their dividend payout?

Yesterday I receive my Starhill REIT circular.
Basicly I'm OK with the proposal, but haven't really decide vote against or vote for it.

It propose selling of Starhill and Lot 10 for RM1.03 Billion, to be satisfied with issue of CPU and cash. Most of these cash and CPU will end up buying YTL Corp Hotels, which I must rethink twice. Nonetheless, if such proposal goes accordingly, Starhill REIT will become the first Malaysian Hospitality REIT.

Increasing bumiputra property ownership. In this context, Pelaburan Hartanah Berhad will establish a Real Estate Investment Trusts (REITs) to facilitate Bumiputra investment in commercial and industrial properties and benefit from property appreciation

Wonder if this Govt linked REIT will be listed

Margin can last indefinitely.
Margin mean use existing share or reit as collateral to get more loan money.
For me, I consider as "downgrade" become more hassle. 

Reit is an upgrade version, and comfortable version. 

Also risk involved is higher than reit.

But it depends on individual appetite on this issue, nothing right or wrong.

Fyi, residential rental market is not that lcurative compared to commercial.

There are odeli Billionaires like EPF invested in REITS.

And Tamasek is going to buy some Sunreit. Another Billionaire .

REIT  is about Asset Allocation if you believe you need one.

How about capital gain, these few hot years (2009-2010)capital gain from physical properties are quite high (30% a year), but REIT's has been on the slow side (5%~10%). Is it because the properties held by the REIT is already over valued, or commercial properties are less 'hot'?  How come there are no residential REITs which invest in an entire condo block? Plenty of those overseas. 

The right mentality of investment is to get a piece of return that is higher than FD or conventional tools like bonds with some risk involved.

Investment is not for "get rich" or "get rich quick".

Claim or not claim, I/we don't care, what we care what is the risk we are taking, what expected return can be.

In reit, we expect some yield for 7-8% which is 2x FD rate can offer, with any capital appreciation side is a bonus, and not something take for granted.
If FD is offering 7-8%, I/we might dump reit as well.

People only talk about good side of story of real physical properties investment, like who become millionaire become invested in properties, who gain 40% yield because buy at right location right timing etc.
But there are still a lot of people that buying some properties under abandoned project (which bank still charge loan interest), shoplots that grow grasses only, little tenants want to rent, buying lots in shopping mall that never fill up more than 30-50% etc.

There are also a lot of people bought properties at 10K, but now worth 150k, after 20-30 years, but if calculated carefully, the real/net return rate is worst than FD. But still people proclaim, it is a successful investment, see invested in properties 10K become 150K, or become millionaire, in fact it is not a successful investment. 

This is always little point in comparing which investment is better than the others, it never has any conclusion because there is never "best/better" investment than the others. They just has some pros which one may like and comfortable with it.

If FD is 10%, then reit price will be adjusted to a yield around 15%. Market is always efficience in this kind of adjustment.

10% FD rate may never occur in our or my life time again.
and also, I don't wish it to be happening.

1998 FD rate was 10%+, which I had seen some people dump FD 5 years at a rate of 10.xx% + Free Astro subscription for 1 year inclusive hardware installation.

the dividend of reits is real dividend or not? i mean after the exdate, do the price decrease like ordinary share?

My top choice are ARREIT and QCAPITA. I want to put AXREIT in too but since everyone says it's "over price" liao. Do you think its price will drop?

What's yours? 

Around 8% will be attractive enought.

But I don't like one of its portfolio, Sunway Carnival.
(My personal opinion only)

Location is not strategic.
Crowd is low
Not fully occupied.

Nearby got 3 shopping mall around, while too many hypermarket surround also, one of the mall is in dying shape.

Population at there area is not high.

Don't get me wrong, it is a nice mall, but crowd is not there due to population and spending power is low at there area. 

So I don't expect this mall can do very well, main reason, wrong location to start with vs Capitaland's Gurney Plaze in island, which always crowded, and higher spending power there.

Sunway Carnival is ok lah, so far can see all the shop lots occupied. Parking is also very full during weekend. Will go there once a month or so. At least it is better compared to Pinang Megamall and Aeon Seberang Prai, those two are really waiting to close shop already. The only problem is that the mall is quite smallish, and also the anchor tenants have little floor space. The sunway hotel next to it, is also have quite low occupancy, but it's cheap. You will be surprised people living on the mainland is lazy to go to the island, as you have to pay RM 5.60 plus it is too crowded & jam here and there. 

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Added on July 8, 2010, 5:47 pm

Queensbay is giving gurney a run for it's money, used to favor gurney, but nowadays prefer Queensbay as it is bigger, with better layout and tenants. Gurney is quite cramped especially at the LG floor, now modern shopping mall emphasize a lot more open areas compared to maximizing retail space. Gurney is more of the latter, but it is trying to expand. 

I also got some QCapita at 1.01 yesterday! 
Also today, got some ARReit at 0.845! 
I want to put more % of my portfolio to less risky Reits! 

Speaking of the Japan Resort that Starhill mentioned to buy, I don't see any official announcement on the proposed acquisition at Bursa website.
Is it really coming?

High yield reit come from high leveraged reit.

In 2008, there are a lot of overseas reit went under main because of leverage issue, which in severe recession, and credit freezing time, those high leveraged reit cannot refinance the loan commitment, so need to fire-sale their properties during that time which is the main reason those reit went under.

If solely properties valuation depreciation, those reit won't suffer as what 2008 happened.

Recession is always associated with credit freezing because generally banks reluctantly to lend in recession due to credit risk.
Banks are always like that, promote/give their umbrella during sunshine days, but keep those umbrella during rainy days.