H&R Real Estate Inv Trust (HR.UN.TO)

The dividend is reasonably secure. It has a 91% 2015 estimated payout ratio, which has been trending up a little. They have made their portfolio look better by selling half of their industrial portfolio, and will probably use the proceeds to pay down debt or do buybacks or stock. If you believe yields are going to go lower, this is one that you can buy.

They have diversified. Their tenants can withstand the weak oil prices of today.

About 500 properties with a mix of office, retail and industrial. He tends to shy away from REITs that are all over the place. It really gets hard to understand how it is going to do. Trades around 16X AFFO, which is on the high side.

Largest commercial REIT in Canada. Pulled back due to oil among other things and this is your opportunity to buy it. When they started buying malls, they bought management as well. It now has a different place where it will grow. You will get okay growth with this one.

REITs. A lot of people are worried about rising interest rates, but he thinks it is not likely to happen any time soon. This sector looks interesting. This has been an underperformer. Prefers GRT.UN-T.

Very well-managed company. Very astute management. He is not in this because he doesn’t like the configuration on the fixed income side and the headwinds they may face if rates go up. Management is capable and can handle a lot of things.

REITs. H&R is one of his favourites. He is favourable to REITs now. They took a nasty hit during the taper scare last year. All REITs should do well, especially HR.UN-T. 6% yield.

Has sold down his investments in REITs over the past year or so. This one got into trouble in the crisis of 2008-2009 and used the opportunity to shore up its balance sheet. REITs is more of an interest rate play, so if you think interest rates are going to stay lower for longer, it would be an advantageous investment. However, as soon as those 1st signs come in, you are going to see volatility. In his view, a company like Inter Pipeline (IPL-T) would be able to offset a rate increase.

This seems to have lost its way a little. It is scattered into shopping malls, US projects and are a little bit all over. He still wants to see what they need to be when they grow up. Thinks they will be starting a share buyback later in this year.

Thinks there is room for growth here. Any vulnerability is likely going to be interest rates. These real estate companies had done well over several years because low interest rates had driven investors and pension funds to other sources of yields. The price of real estate has been going up and up to levels that don't make any sense. As interest rates go higher and there are other options, you could see real estate continued to be under pressure. He doesn't think interest rates are going to go up very much.

The argument against this and other REITs and interest-rate sensitive stocks, was during the interest rate scare. Although interest rates might be going up, so do rents and therefore the cost of borrowing is offset by increased rental revenues.

Diversified REIT in industrial and retail. Have evolved greatly as a company over the last couple of years. He thinks they will do things that will add value for investors.

(Market Call Minute) A good player in the market and a bit cheaper than others. There are a lot of catalysts that could cause this REIT to go higher.

Likes it. Has a great source of ongoing income. It is the type of high income stock that will survive increasing interest rates. Came off recently because of rate rise scare earlier this year.

This is a bit of a bond proxy. A bit of a yield play because they have maturities on their rents that are so far out. Sees the nice 6% dividend supported by an 89% estimated 2015 payout ratio. Reasonable growth of 3.6%. 98% occupancy.