Artis Real Estate Investment Trust (AX.UN.TO)

Management is solid. It is a western story. It is about 20% in the US. They had a hiccup related to a lease termination there. Their occupancy rate went down from 96 to 94% and it affected their AFFO. It is just a matter of timing and they will lease it back up. The payout is not too heavy. Thinks it will continue to grind higher, but it is late stages.

Large proportion (20%) of their assets are in the US and the rest in the four western Canadian provinces. Took advantage of very open capital markets to grow its portfolio on the asset side accretively. They brought down the payout ratio and the leverage. The distribution is over 7%. Thinks the NAV is approximately $17.

Bought US properties when dollar was close to par. The issue is that there is some suburban office exposure in Western Canada. The dividend is sustainable. He would nibble away here, but you may get a better opportunity in the coming months.

(Market Call Minute)They don’t have particularly great quality buildings. They don’t have a focused strategy and there is no organic growth profile there.

We are in the 8^th to 10^th inning of a baseball game with an extra inning. It is about 14 times AFFO. He thinks you get a 6-8% rate of return and nothing more than that. They are good operators. They are good at adding value. They are at a high price level and there is always a feeling they could be taken out by a bigger entity.

Nice yield and diversified across North America. They are smart guys.

A high-quality REIT. In Western Canada and expanding into the US. Suffers from somewhat limited growth and being interest-rate sensitive. 6.7% yield.

Likes this company and the fact that it is mostly Western-based, which is where the growth is.

They are upping their exposure into the US, which is currently at about 24%. Their goal is 30%. A higher leveraged name, but their balance sheet is improving. He sees in-line growth of around 3.5%, which is equal to its diversified peers. Payout ratio is trending down and looking a lot better.

They issue more and more shares. This is a way to grow. But in the mean time every time the stock goes up you worry about another equity issue and it resets the price. He is concerned about how soon they did the most recent acquisition after the previous one, but it is attractive here and he would not mind adding a little here.

Diversified REIT that invests in office, industrial and retail. Management team is focused on reducing leverage and payout ratio. 50% leverage right now. Going forward the key is to make sure they have a laddered maturity profile for their debt. They should be just fine.

A great management team. Made a strategic decision to explore in the US when assets were cheap. About 25% of the portfolio is US. They have retail, office, industrial. They execute well. They will be slightly hurt by the recent Canadian dollar appreciation. They are trading nicely and not too expensive, but interest rates can get in the way.

(A Top Pick June 17/13. Up 8.06%.) People have become more comfortable with this, and have started giving it a higher multiple. Recently did a large equity raise so they have some extra cash on the balance sheet. He is watching to see what they do with this.

More of a growth by acquisition story. Management has done a good job digesting what they had. Recently did an acquisition to broaden their US exposure. Likes this because of the US exposure. Thinks you will see the benefit of a lower Cdn$ show up in the NAV. The US is a bit of an inflection point where you should see occupancy and rents go up, which will disproportionately benefit this company, being one of the larger caps in Canada that has US exposure. Trades at about a 10% discount to NAV.

A REIT that is basically 50% office building, 25% industrial building and 25% retail. Have about 23% of their cash flow coming from the US. Regarded as a well managed REIT. Yield is quite attractive.