Commercial Properties & REITs - General News

[winston]

5 Reasons Why REITs are Better than Physical Property Investments

Source: Propwise.sg

https://sg.news.yahoo.com/5-reasons-why ... 0c-;_ylv=3

[winston]

5 Reasons Why Every Investor Should Own REITs

REITs generally offer better returns and a solid income

By Charles Sizemore

http://investorplace.com/2015/02/5-reas ... NaxuOaUd1Y

[winston]

This Is One of the Best Income Opportunities Today By Dr. David Eifrig

No matter what type of income investor you are, worries about the broad economy dominate today's markets.

The specter of rising interest rates hangs over every income-producing asset. And it's true… the more yield investors can get from bonds, the less they'll be interested in riskier sources of income, such as dividend-paying stocks.

But we think these fears are overdone today… and it gives us an excellent opportunity to pick up safe and stable income from a certain class of income-producing assets – no matter what happens in the broad economy.

I'm talking about real estate investment trusts, or REITs…

Regular readers know that a REIT is a special way to structure real estate holdings. A management company serves tenants, maintains buildings, and gets big tax breaks in exchange for agreeing to pass on the vast majority of its annual income to shareholders. (This allows it to pay fat dividends.)

This makes REITs a great way to invest in real estate assets without having to deal with the headache of personally managing them. And because REITs trade as shares in the stock market, you can sell your investment at any time… a normally difficult and time-consuming process as a personal property owner.

Today, some analysts suggest staying away from REITs because interest rates are bound to rise eventually.

The thinking goes as such… The economy is improving. As the economy improves, the Fed will raise rates. When the Fed raises rates, all interest rates will rise. That will make the yield on REITs look less attractive in comparison and raise borrowing costs for REIT operators. In turn, the share price of REITs may fall when interest rates rise.

Of course, those same analysts have been making these same claims since 2013. They've underperformed as a result. Nearly every step in that "logic" is hogwash.

First of all, market pundits have predicted that the Fed would raise rates for years now. It hasn't happened yet. It'll happen eventually, for certain. But slowing economic growth and the complete lack of any inflation will delay a Fed move even longer. The futures market expects an increase in rates of 0.2% by the end of the year. That's not a big move.

Remember, the Fed only controls one single short-term interest rate called the Federal Funds rate. Raising this rate has some wider effects, but it's the supply and demand of safe assets that truly determines interest rates. With so much wealth and so few low-risk assets in the world today, we think rates on medium- to long-term securities will stay low.

More important… REITs perform just fine in times of rising interest rates.

While many investors accept the "conventional wisdom" on interest rates and REITs, history doesn't back it up.

From 1970 to the early 1990s, there were four periods of rising interest rates. REITs split the difference… rising in two of those periods and falling during two. Of course, take that with a grain of salt, because most modern REITs didn't really take shape until 1993. But it's clear there's no strong historical relation between interest rates and REITs.

Looking from 1993 on, there have been three times rates have risen… The first, 1993 to 1995, saw REITs rise 21%. The second, from 1999 to 2000, saw REITs rise 17%. The third, from 2004 to 2007, saw REITs rise 99%. (All numbers include dividends.)

Anyone who says rising interest rates mean death for REITs simply hasn't looked at the facts. And that's exactly what we do in my Income Intelligence newsletter.

You'll often see headlines these days like, "REITs Fall on Fed Statements." REITs move with interest rates in the very short term. Little hiccups happen here and there as investors get spooked. But extrapolating a short-term move to long-term investment returns is a recipe for major blunders.

The trick is that REITs are real businesses with real fundamentals. Interest rates rise when the economy is hot and everything is running at full blast. During those times, it is true a treasury bond may look a little more attractive than a REIT on a yield basis, but with the economy growing, REITs see higher tenancy rates, higher rents, and bigger profits. Those factors trump the effect of higher interest rates.

Also recall that interest rates rise during periods of high inflation. When inflation becomes a concern, the Fed tries raising rates to choke it off. Not much hedges inflation better than real estate.

That's why we're happy to own REITs no matter where rates go over the long term.

We're going to see short-term volatility from interest rates, but that's a small price to pay. REITs are exactly the sort of counter-cyclical asset an income investor needs in his or her portfolio.


Source: Income Intelligence

[winston]

Know the risks before jumping into REITs

By Goola Warden

SINGAPORE (July 8): Analysts and investors are rediscovering real estate investment trusts (REITs) in the wake of rising uncertainty about global growth, especially after UK's surprise decision to break away from the European Union.

Since June 23, the day of the referendum, the FTSE ST REIT Index has risen 5% compared with a 2.7% gain by the Straits Times Index. The REIT index has gained 8% since the start of the year, compared with a marginal loss by the STI.

REITs are not insulated from weakening economic growth, but they are structured to deliver most of their total return through cash distributions. And, that bond-like quality makes them attractive to investors when interest rates are softening.

However, investors should consider these two types of hurdles before jumping into REITs:

1. Currency risks

While loose monetary policy is making REITs attractive to investors, it is also causing significant volatility in the currency market, which could be negative for REITs with overseas assets. Besides affecting the income that investors receive in Singapore dollar terms, currency volatility could also have a negative impact on the net asset values of REITs.

2. Operational risks

Analysts who cover REITs are bracing for bad news during the upcoming results season, which starts later this month. What is weighing on their performance? Broadly, the problem is rising supply in the face of soft demand as the economy slows.

A possible dark horse among locally-listed REITs is Croesus Retail Trust (CRT), whose unit holders passed a resolution on June 30 for the trust to acquire its trustee-manager, Croesus Retail Asset Management (CRAM), for $50 million.

(See http://www.theedgemarkets.com/sg/articl ... ee-manager)

Source: The Edge

http://smr.theedgemarkets.com/article/k ... 4-87358173

[winston]

Here’s a new ETF to invest in

By Gwyneth Yeo

SINGAPORE (Oct 6): Phillip Capital Management has launched its first exchange traded fund (ETF), Phillip SGX APAC Dividend Leaders REIT ETF, with an initial offer period from Oct 5 to Oct 13.

The REITs ETF, which will track the recently launched SGX APAC Ex-Japan Dividend Leaders REIT Index, comprises the top 30 REITs listed across the Asia Pacific exchanges excluding Japan, ranked according to the total dividend paid in the preceding 12 months to their unit-holders.

The REIT Index thus represents more than 70% of the region’s REITs by total market capitalisation, and takes into account the REITs’ size, free-float market capitalisation and liquidity.

Jeffrey Lee, Managing Director and Chief Investment Officer at Phillip Capital Management, said in a release that the new ETF acts as a “proxy to long term economic growth in Asia driven by rising income and increasing urbanisation”.

It also provides investors with a “transparent and low cost access” to a portfolio of REITs that offer a sustainable dividend income.

Phillip Capital Management is one of the largest, non-bank backed local fund managers in Singapore, with $1.4 billion of assets under management, and is a prominent investor in the Asian REIT asset class. It manages the first and only Singapore REITs fund, the Phillip Singapore Real Estate Income Fund.

The ETF will trade on the Singapore Exchange from Oct 20, in both Singapore dollars and US dollars. The indicative issue price of each unit during the initial offer period is expected to range from US$0.880 to US$1.100 for the primary currency of USD and $1.188 to $1.485 for the secondary currency of SGD, based on the exchange rate of 1.35.

The ETF also plans to make dividend distributions semi-annually, subject to Phillip Capital Management’s discretion.

Source: The Edge

http://smr.theedgemarkets.com/article/h ... etf-invest

[winston]

One of the best ways to boost your income in 2018

by Peter Churchouse

Source: The Stansberry Churchouse Letter

http://thecrux.com/heres-why-you-should ... next-year/

[behappyalways]

Out Of Office: Global Vacancies Hit Record High
https://www.zerohedge.com/personal-fina ... ecord-high

[behappyalways]

Office format changes. Enterprise leasing demand decreases

辦公形式改變.企業承租需求降低 「共享辦公」走下坡｜方念華｜FOCUS全球新聞 20231115@tvbsfocus

https://m.youtube.com/watch?v=vwKsB7clBfw