Bruce MurrayBoardwalk REITBEI.UN.TOBUYJan 05, 2024

Stock's moved up and down. Still likes that 75% of portfolio is not subject to rent control. National population growth declined, but it increased in the space that BEI.UN operates in. Taking advantage of its implied cap rate and buying back stock.

One of only 2 REITs he owns. Payout ratio is very low and so is the risk of dilution. 

Lower-yielding stock by design, and he likes that as it gives them a lot of flexibility. Thinks very highly of management. 72% of net operating income comes from non-rent-controlled markets. Mostly in Alberta, which is affordable for people. Good level to buy today. Yield is 2.4%.

One of the larger Canadian apartment REITs. Mostly in Alberta, where there's no rent control. So with population growth, it can raise rates faster. But if economic slowdown in Alberta, this name feels it faster. Pivot in Canadian immigration policy put the whole apartment sector under pressure.

Well run. Alberta's economy is doing really well, and cost of living is better than many other places in Canada. Likes the sector. Stock's cheap relative to underlying asset value.

Immigration is not actually being lowered, it's more that we're returning to nice, stable growth. A lot of these people are going to move to Alberta, where BEI.UN has the majority of its properties. A lot of Ontario is moving to Alberta as well. The pro-energy trend will also benefit Alberta.

In Ontario it can take 6-8 years to get permits to build an apartment building, 2 years to build, and then you're faced with rent control. Alberta is much more friendly in this regard; so rents are cheaper, and there are more rental units.

Affordable + non-regulated. So when inflation hurts its operating expenses, it can raise rents. Alberta's enjoying above-average population growth. Market's overly concerned about economic impact on Albertans. Yield is 2.44%.

Owns shares in business. Portfolio includes properties in Alberta which is not rent controlled. Recent share price sell-off not a concern. Overall is a high quality business. Concern around tariffs not a worry. Would recommend buying. Alberta is a great place to do business, and is expected to keep growing (good for business). 

Great run up to his target price of $90, so he trimmed. Buying back now at attractive levels. Strong earnings results continue. Alberta is affordable and seeing migration.

Great opportunity to buy now, near 20% discount. Cashflow growth is growing in a compelling way. Pullback due to concerns over population growth. Alberta still looks like a winner from inter-provincial migration for affordable housing.

BEI.UN is still considered an 'oil sensitive' REIT because of its Alberta focus. The energy sector has been quite weak, and this is likely a big reason for its drop from $91/unit. But it is still up 8% YTD and 22% over one year. The last quarter was fine, but its relatively low yield of 1.87% and its higher valuation can limit investor interest at times. We would be OK buying for income and growth. 
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Continues to execute. Valuation remains compelling. 2/3 of portfolio in Alberta, a growing province. 74% of portfolio in ALTA and SASK, where there are no rent controls. Strong earnings trajectory. Cashflow and earnings will increase. Yield is 2.1%.

Benefited from immigration in Canada. Lack of rent control in main market, Alberta. Fully valued now, easy money has been made. Housing shortage, too.

(A Top Pick Dec 06/22, Up 42%)

He knew going into 2023 that there would be an explosion boom given more immigration and the housing shortage. He owns CAP REIT too. This trend continues into 2024 unless supply-demand change, which will be slow to happen.

Headline "Soaring Canadian housing costs drive population boom in Alberta" tells the story. Affordable housing, with 78% concentration between Alberta and Saskatchewan. Despite being able to increase rents, they continue to be affordable. Discount to NAV, yet NAV continues to grow. Limited new supply, pricing power. Yield is 2%.