Allied Properties REIT (AP.UN.TO)

Missed on Q3, so he reduced his guidance. Poorer lease-ups in Montréal and temporary vacancies in Vancouver and Edmonton. 2016 was definitely a step-back year. There has been a big pull-back in REITs, but this is still trading towards its five-year average, so it is not cheap. However, he sees a big return of growth next year which would give about 12% adjusted funds from operations growth smoothed out from 2016 to 2018. One of the best balance sheets out there, and a lower payout ratio. The kind of REIT that should hold up in a rising bond yield environment. He would Sell a Call on this, wait for it to come off a couple of bucks, and then Write a Put on it. Dividend yield of 4.3%.

Its assets are wonderful old buildings all across Canada. A very unique asset class. These are hot and where you want to be if you are a hip kind of company. It has been really well run with a strong kind of discipline. It can be volatile, and most recently because of interest rate increases and the decline in REITs in general. This is one of the favourite REITs, and has suffered alongside most REITs. Dividend yield of 4.5%.

(A Top Pick Nov 12/15. Up 5.27%.) Really unique properties, probably the best landholdings of any of the REITs. As the economy moves, the growth we have seen in the past just won’t be there in the future. It will probably take 3 or 4 quarters before the growth stabilizes.

This is known as the niche brick and beam landlord in Toronto. 40% of their properties are in the downtown core. The name has pulled back recently, mostly related to the pullback in REITs. Also, 10 year bonds are backing up a bit giving a bit of consternation in the space. The name has come down to a level where it is trading around its NAV, and you are basically getting a bunch of undeveloped land for free. There is some pretty good upside. It very rarely comes down to this level where you can buy it. Dividend yield of 4.34%.

(A Top Pick June 23/15. Up 13.18%.) Usually an outperformer, but the market has been up at the same time by about 11%. Has added more just recently. Still has growth going forward. Very urban focused, Class I office with retail components.

He would wait for the turn. He puts faith in management to get things going again. An interesting holder of lands west of King Street in Toronto.

He likes this company. They run a very special kind of office space by taking industrial buildings and turning them into offices that look a little like a loft with an open space aspect. It’s difficult to evaluate, because it is not the traditional office space. They have been pretty good at executing a strategy of redevelopment and intensification, and currently have a couple of very interesting projects that will derive cash flow growth in the future. Facing some headwinds near term, because of vacancies. In the last few quarters those vacancies have offset the development growth they have been having. If you see a strengthening in their occupancy rate, then you could consider this as being higher growth. He definitely likes this one. 4% dividend.

(Top Pick Jan 29/15, Up 16.82%) A very solid management group. They had problems digesting their acquisitions. He got out earlier in the year and intends to now get back in.

He loves this one. The stock has really taken a hammering. It is a better company today, but is the same price as two years ago. When a really good company gets beaten up, it is a good time to add to the shares. There could be one or two more quarters of stress. Buy on the dips and wait. Calgary being weak is not new news.

(Market Call Minute.) High quality management team and a low payout ratio. A $35 stock with about $4 in development potential as it materializes in the next few years.

You don’t get this one on sale very often. It has really come off. It is an opportunity to get into it. They have developments coming on line and good retail properties. This is a nice opportunity. They are continuing to diversify geographically.

They have brick and beam office buildings. Management has done a top notch job of consolidating the sector. He sees $4/share in increase in net asset value. He thinks it will grow into its valuation as these developments complete and start producing income. Balance sheet is clean and you can bank on significant dividend growth for the next few years.

(A Top Pick March 17/14. Up 17.24%.) The underlying fundamentals continue to drive and we have a relatively strong economy, and this company is able to continue to expand its cash flow. Very happy to continue holding this.

(Top Pick Feb 28/14, Up 24.60%) Has a very disciplined organic growth pattern. He continues to hold and it is a large position. This is a well run investment trust. It is a development, acquisition and urban intensification story.

(Top Pick Dec 17/13, Up 22.88%) They outpace the entire REIT space with the amount of growth they have.