S-REITS = attractive and stable high dividend stocks

Singapore REITS Index has firmed 2.8% in early 2012
As of the 11 January, the STI had risen 3.8% in the 2012 year-to-date while the S-REITs Index had firmed 2.7%. In 2011, 17 out of 22 S-REITs outperformed the Straits Times Index (STI). Over the course of 2011, 21 of these S-REITs provided an average dividend yield of 6.0%, ranging from K-REIT’s 3.4% to First REIT’s 9.3%. The minimum investment per lot for S-REITs, based on 10 January 2012 prices, range from as low as $138 for Saizen REIT to $3,920 for Fortune REIT.
Singapore Exchange (SGX) offers comprehensive market coverage of the Singapore property market through 22 Singapore-listed Real Estate Investment Trusts (S-REITs). Over the first seven trading sessions of 2012, the FTSE ST Real Estate Investment Trust Index has firmed 2.7%. As of Tuesday 10 January,  REIT performances in 2012 have ranged from Ascendas REIT gaining 6.6% to Parkway Life declining 2.0%. Ascendas REIT is a property trust which owns and invests in a diverse, income producing portfolio of business parks, light industrial, high-tech industrial and logistic properties in Singapore. Parkway Life REIT, invests into healthcare related real estate assets. For the year 2011, 17 out of 22 S-REITs outperformed the Straits Times Index (STI) which declined 17%.  In terms of price performance in 2011, the Parkway Life REIT was the top price performing REIT in 2011 as its price was up 8.5%. Taking into account price AND dividends, First REIT provided the highest total return of 16.3% in 2011. The classes of REIT properties can be divided into office, retail, office/retail hybrids, industrial, healthcare, hospitality and residential. The objective of an S-REIT is to raise capital to invest in real estate asset, allowing investors to be "property owners" without those occasional burdening requirements of renovation, maintenance, repairs and security. REITs also provide a potentially more convenient way of property investment for small investors. The minimum investment per lot for S-REITs, based on 10 January 2012 prices, range from as low as $138 for Saizen REIT to $3,920 for Fortune REIT. The table below lists the 22 S-REITs available on SGX, across the various sectors of properties ranked according to their 2012 performance as of Tuesday 10 January. The table also includes the total return of these REITs in 2011, which consists of both price returns and dividend distribution made. S - REITS Sector 2012 YTD Total Return 2011 Price Return 2011 Dividend Yield 2011 Total Return ASCENDAS REAL ES Industrial 6.56% -11.59% 5.85% -5.75% K-REIT ASIA Commercial 6.02% -36.15% 3.39% -32.77% LIPPO MALLS Retail 4.29% -16.67% 7.19% -9.47% FORTUNE REIT Retail 4.26% -6.00% 5.97% -0.03% FRASERS COMMERCI Commercial 4.05% -10.84% 7.17% -3.67% SUNTEC REIT Mixed Commercial 3.72% -28.33% 4.22% -24.11% MAPLETREE LOG TR Industrial 3.55% -12.89% 6.53% -6.36% CAPITAMALL TRUST Retail 3.24% -12.82% 4.94% -7.88% CACHE LOGISTICS Industrial 3.16% -2.06% 9.03% 6.96% STARHILL GLOBAL Mixed Commercial 2.65% -10.32% 6.88% -3.44% AIMS AMP CAPITAL Industrial 2.12% -14.09% 8.99% -5.11% CAMBRIDGE REIT Industrial 2.11% -8.65% 6.64% -2.01% SABANA SHARIAH Industrial 1.71% -10.71% 7.90% -2.82% CAPITACOMMERCIAL Commercial 1.42% -29.67% 3.76% -25.90% FRASERS CENTREPO Retail 1.39% -4.00% 5.20% 1.20% ASCOTT RESIDENCE Hospitality 1.01% -18.85% 4.59% -14.27% FIRST REIT Healthcare 0.66% 7.04% 9.27% 16.31% MAPLETREE COMMER Mixed Commercial 0.59% -3.41% 0.00% -3.41% MAPLETREE INDUST Industrial 0.47% -0.46% 6.83% 6.36% CAPITARETAIL Retail -0.87% -7.26% 6.52% -0.74% SAIZEN REIT Residential -1.43% -17.65% 8.15% -9.50% PARKWAYLIFE REIT Healthcare -1.96% 8.48% 5.94% 14.42% Source: Bloomberg, 11 January 2012 REITs provide regular cash flows for investors in the form of dividends and some of the REITs provide higher annual yields than the current deposit rates. Aside from the MapleTree Commercial Trust, which had an Initial Public Offering in April 2011, the S-REITs, offered an average dividend yield of 6.0% in 2011 ranging from K-REIT’s 3.4% to First REIT’s 9.3%. As a summary, some of the key reasons for having REITs as part of an investment portfolio are highlighted as follow: Portfolio DiversificationREITs typically own multi-property portfolios with diversified tenant pools, which reduce the risks of reliance on a single property and tenant in the case of directly owning a real estate asset. Income DistributionREITs normally have regular cash flows since in most cases, most of the revenues are derived from rental payments under contractually-binding lease agreements with specific tenure. Participation in the Property MarketMost REITs are structured around large properties. With REITs, an investor can own stakes in such properties. Professional ManagementREITs allow investors the opportunity to buy into properties managed by professional property management companies.
The underlying assets of a REIT could include commercial, retail, industrial and residential properties that are located within a specified country or region. Under guidelines issued by the Monetary Authority of Singapore (MAS), a REIT may also invest in listed or unlisted debt securities and listed shares of or issued by local or foreign non-property companies, securities issued on behalf of the Singapore government or foreign governments or by a supranational agency or by a Singapore statutory board, or cash and cash equivalent items. The majority of a REIT’s assets must, however, be made up of real estate or real estate-related assets. The Property Fund Guidelines can be found in the Code on Collective Investment Schemes issued by MAS.

A good article explaining S-REITS in details from SGX. I like S-REITS and converted half of my invested fund to S-REITS due to last year uncertainty. If the uncertainty persists, i wont change my portfolio as S-REITS really worth to invest!

CapitalMall Asia Broke 20 Days Moving Average!

CMA is back to 1.2 now! It is an exciting news to share. As discussed on previous links if it is back to 1.2, i will buy this counter. The preferred entry price is 1.8 - 1.2.

Now CMA is rebounding second times since last week. It is an encouraging news but the low volume worried me; continous evaluation is required due to the last confirmation - high volumn. Anyway, it looks positive. A high volume will definately firm up my determination.

Chinese New Year Holiday is around the corner, that can be the cause for low volume. Hence i am expecting a high volume after CNY. If this not gonna happen, re-evaluating on the decision to hold or sell off this counter is a must. If it happen as per expectation, a strong rally will come. This counter sleep too long. Time to wake up and prove its capability to investor!

CapitalMall Asia Broke 20Day Moving Average!



CapitalMall Asia Movement

CMA does not break through its resistant line at yesterday. It is struggling at the range of 1.16 - 1.18. However MACD shows that the golden cross is formed, but the momemtum and volume is not high. Normally golden cross formed the shares price will go up, but this counter does not have high volume to sustain the uptrend at the moment hence it may end up a short term rebound and going downward again as it never break through the 20days moving average.

I will wait and survey whether second rebound will be forming? If it happens and the rebounding is stronger then current price definately i will buy more for this counter. Tentatively i will set 1.2 as indication price to attract my attention to re-evaluate the buy call.

CapitalMall Asia in eyes 2

New year rally is coming. STI rebounded from its bottom since tuesday. This rally mostly due to fat bonus from individual company and lead to strong buying desires among retail investors. A lots of indicators shown positive signal and hint that a buy call is coming!

Capitalmall Asia is one of the stock i will invest at current price. It is below NAV, one of the blue chips at discounted price, fundamentally strong and now it is in the process of forming a golden cross on MACD. I will set tomorrow as evaluating day for CMA as its price is approaching 20 days moving average. If break through, i am quite certain a rally will come. How much room it can go up definately have to depend on investing enviroment and big players. Can retail investors strong buying create buying desires among big players? At the moment no indication on this, stayed tunes for the update.

Happy New Year. Huat ar!



CapitalMall Asia



Market Summary for Year 2011

Singapore shares ended lower Friday, capping a tumultuous year in which the benchmark Straits Times Index lost 17.0%, roughly in line with the rest of Asia.
The 30-share STI closed 1.0%, or 26.43 points, lower on the day, at 2,646.35. Market activity was low as most participants had already closed their books for the year amid lingering caution over the euro-zone sovereign debt situation. Volume was a mere 437 million shares, compared with 472 million Thursday. Gainers edged decliners 194 to 154.
Investors can now reflect on a volatile year for the local equities market. Unrest in North Africa in February led to heavy selling and the STI slid 5.3% in the month. The huge earthquake that hit Japan in March further shook investor confidence and wiped out the recovery from February's sell-down. But the biggest shock to the local market came in August. At the end of September, the STI was sitting pretty at 3,189.26 but the downgrade of the U.S. sovereign debt rating by Standard & Poor's triggered a global market meltdown. Singapore, with its open and export-dependant economy, wasn't spared. The STI fell off a cliff and when it hit the bottom, at a low of 2,521.95 on Oct. 5, it had fallen 21%. Since then, the market has been dogged by fears over a potential double-dip recession in the U.S. and a hard landing for China's economy, but most concern has centered around Europe's sovereign debt crisis. Heading into 2012, market-watchers say the issue looks set to drag on.
"In the new year, the market is expected to remain volatile in the short term, given global uncertainties, especially in Europe," said OCBC Bank in a note. DMG & Partners said it expects further market weakness in the first half of 2012, "due to the persistent euro zone debt problems." However the brokerage said the STI could rise in the second half of the year and reach a level of 3,022. It said this target is based on valuation of 1.31 times price-to-book, below Singapore's 15-year historical average of 1.65 times, which it said was "justified given the global uncertainties."
CapitaLand Ltd. was on of the day's biggest blue-chip decliners, down 1.8% at S$2.21. The developer's stock has plunged 40% in 2011, weighed by government policy measures in Singapore and China to cool rampant property markets.

From Poems' Broker Agent.

STI is in downtrend, how it will perform at 2012? Will it rebound at first quarter or remain flat? At the moment there is no indication;
currently a lots of stocks for Singapore market is in the oversold region.

FSL Trust after re-financing.

Watson Farley & Williams Asia Practice (WFWAP) has advised a syndicate of banks led by the Bank of Tokyo-Mitsubishi UFJ as agent, and the Singapore branch of UniCredit Bank as security trustee, in relation to a US$479,557,744 refinancing loan to a ship lease financing trust, a significant amount at a time when the global shipping industry is facing choppy waters.

The term facility was provided to FSL Trust Management, as trustee-manager for First Ship Lease Trust, to refinance the latter's existing credit facility. The bank syndicate also included the Singapore branch of ABN AMRO, OCBC, the Singapore branch of Sumitomo Mitsui Banking Corp, the Singapore branch of UniCredit Bank, Korea Development Bank, ITF Suisse and KfW IPEX-Bank.

The 25-ship fleet of First Ship Lease Trust, a SGX-listed trust that specialises in non-tax driven leasing services to the global shipping industry, was used to secure the term facility. The ships are on charter to a variety of international owners and operators, and thus the transaction involved coordination with local counsel and/or registries in Singapore, England, the Marshall Islands, Malta, Taiwan, Indonesia, Cyprus, Liberia, Panama, Italy and the Bahamas.

Partner Goh Mei Lin led the WFWAP team, and was assisted by Shawn Er and Hayley Arrow. Allen & Gledhill acted as lead counsel for the borrower, while the main local counsels for the lenders included Arias B. & Associates in Panama, Higgs & Johnson in the Bahamas, and Asia Practice in Singapore.

Goh admitted that the number of ships, charterers and jurisdictions involved in the deal, along with existing market conditions, had made it a complicated transaction to pull off. "Some factors which were helpful in securing a financing of this size in this market include the fact that many of the lenders involved are lenders in the existing facility to FSL which the new facility is to refinance (and are, therefore, very familiar with FSL, its assets and its business operations)," she said. "Documentation was undertaken on an intensive basis as there were concerns about the possibility of further increases in funding costs." ALB

Finally FSL Trust eased from its high debt ratio. It eased investor's tension toward this high dividend stocks. Will this loan secured boosting the shares price? As current price is low and attractive to many investors and their main worry / concern is solved. Anyway i in this counter yet and observing their movement as their high dividend looks too delicious to me. No doubt, i am taking risk, but it is a calculated risk.

However the re-financing only pro-long the debt maturity rather then solve the debt. For long term wise, FSL Trust has to reduce their cost or increase its profit or sales to repay its debts.

Market talk by others

STI is not breaking the 2680 level by today. Hence the conclusion will be it is at the downtrend yet? or simply the volume is too low and unable to push it up? Anyway this is a nice video to share. Maybe you can follow up the market talk conducted by Jonathan Tan weekly. Thanks to him for sharing.