Sienna Senior Living Inc (SIA.TO)

Right now the market is starved for yield and supporting almost any acquisition that REITs are doing. Occupancy rates are great, cap rates are low and interest rates are low. Business is good. Until you get an uptick in interest rates, the company should be okay.

7% yield. He sold about 6 months ago. Great managers. You don’t have to deal with the US assets. It is all Ontario based nursing and retirement homes. Dividend is safe and conservative. He got out because of valuation. There is nothing wrong with it. There will be a significant amount of CAP-X to keep it up to date. They rely on provincial support.

(A Top Pick March 21/12. Up 15.38%.) When it hit his target, he sold his holdings. Good company. Feels the upside is much more limited on real estate at this time.

Seniors long term care facilities. Has done a very good job of managing, in what can be a difficult business because, surprisingly, there has been increased capacity. Feels 7% yield is safe. Expects management will be able to pull a little bit more yield out of the business and increase the dividend marginally over the next couple of years.

Have very strong earnings momentum. Earnings were up 24% in Q2 year-over-year. Have good growth drivers in acquisitions. Higher government funding. Have strength in long-term care. Trades at a discount to Chartwell (CSH.UN-T) but has a narrow concentration in Ontario so it should be there. (At a discount?) About 98% occupancy last quarter. Balance sheet looks okay and the payout ratio is fine at about 69%. Try to buy at a little bit under $12.

Chartwell is his preference in this space. You’ll do okay. 7% yield is safe. He likes the seniors’ housing landscape.