Starhill Global REIT
Starhill Global REIT ("Starhill") announced its Q1 results on Friday.
The Company announced a Q1 results DPU of 1.37 cents per unit, much higher than previous year by 28%. If i striped out the one time adjustment from the Toshi lease, the DPU is around 1.18 Singapore cents, which is about 10.3% higher than prior year. This will translate into an annualized yield of around 4.9%.
YTL has probably been a good manager where the DPU is increasing every year. I will probably expect this year to be better than the last as well.
This will explain to you why REIT is a good inflation hedge. The rental and parking at shopping malls in Singapore has been increasing "non-stop" since REIT was introduced here. Isn't it a great feeling that you own part of Ngee Ann City and Wisma? It certainly feel relatively "less painful" when i pay $8 for a short shopping spree at Takashimaya, knowing that i am getting a "rebate" in one way or another via the distributions. ^_^
Happy REITing.
I feel that part of the reason why REITs are booming in the market is due to the low interest rates (as REITs are highly levered). When the rates eventually hiked up, real estate related business would probably take a bigger hit than others. But until that happens, REITs will continue to boom especially while investors seek high yield returns in Asia.
ReplyDeleteYep. That will be the burst of the bubble. :)
ReplyDelete