Boardwalk REIT (BEI.UN.TO)

Really exposed to the energy complex. Lots of rental properties in Edmonton and north. A lot of investors sold this because of fear in the energy sector. It is a pretty good long term investment. He thinks you will see some income growth over time and it is one of the better REITs out there.

The 10 year average return on this was 17% annualized. Because of its exposure to the oil markets, it has come off and rightly so. However, this is one to watch. As oil weakness reaches a peak, there is an opportunity to buy into the real estate at a discount valuation. Try to get it at around $55-$58 or under $60. Yield of 3.48%.

Was down about 15% because of the oil price decline, but is now back and is only down about 10% from its high. He added to his holdings on the downturn. One of the best management teams in the business. There is little to no vacancy in Calgary and Edmonton. Even if it slows down, there are still going to be rent increases, and there is no rent control in Alberta. They have a lot of capital sitting on the sidelines. Yield of 3.27%.

(Top Pick Nov 21/13, Up 16.64%) Still one you should own. Very well managed, low debt, some development opportunities.

Rock solid investment. A great company. Focused in western Canada, where there is a lot of population growth. Should be a core holding for most.

(A Top Pick April 4/13. Down 1.9%.) An apartment REIT with most of their assets in Alberta. With the small percent it was down over the last year, it has probably outperformed both the index and many of its apartment peers. Still likes. Solid management that have been very disciplined with capital.

Feels apartments are very defensive with their relatively quick rate step ups. Situated predominantly in Calgary and Edmonton as well as Fort Saskatchewan. Very, very strong management team. Good organic growth opportunities. Trading at about a 10% discount to NAV. Yield of 3.3%.

Apartments correlate best to job growth and there is a lot of job growth in Calgary, Edmonton and Regina. He feels this has a lot of upside in those areas. Calgary has no rent controls, so it gives outsize rent growth opportunities. They also have a lot of cash in the balance sheet so they can do some developments.

This one is the gold standard in the apartment space REITs. Doesn’t think its distribution is as high as it used to be. If interest rates go up, the stock is going to go down. Extremely vulnerable to rising interest rates. If you own REITs, he would not be buying more, but if you don’t he would recommend you have 5%-10% of them in your portfolio if you are looking for income only. If you are looking for growth, stay away.

(A Top Pick April 4/13. Down 6.3%.) This is a core holding for him. They are an owner/operator and now a fairly active developer of apartment assets mostly concentrated in Alberta. Trading well below their NAV which he thinks is around $64. The embedded free cash flow growth in their portfolio will be in the double digits over the next couple of years. Also, their occupancy level is the highest it has ever been. He would Buy at these levels. 3.3% dividend yield but their payout ratio is under 70%. Have had a very strong history of consistent dividend increases

A core position. Unique opportunity right now. Normally trades at a premium to NAV but at a discount right now. Going forward estimating 8-10% free cash flow growth. Capital structure is one of the best with 70% payout ratio allowing for distribution increase.

Primarily apartments out West. Has the lowest payout ratio at about 70%. A lot of young people out West so the growth will continue. This will be internal growth rather than yield.

Likes it. Apartments do well when economy does poorly. Non-rent regulated market. Excellent management team that optimizes portfolio. Will do well during the next year.