RioCan Real Estate Investment

REI.UN-T

RioCan vs WPT WPT is a good company, but probably wouldn't own it. It's smaller, and they're trying to grow the portfolio, so they're at the mercy of capital markets. A very competitive market. Hard to do accretive acquisitions. RioCan has been adding residential apartments. Won't change overall aspect, and likes the diversification. A measured approach. But fairly valued. Prefers the industrial sectors to either of these.

REITs in general have done well and are now fairly valued -- there are no desk pounding deals out there. You want to own them as they prove they hold their value in the late stages of the bull cycle. As we get more into uncertainty in growth, political turmoil and trade wars the income they generate is good. Don't expect a ton of growth, however, due to the required capex. Yield 5.4%

Lower interest rates have helped this sector. REI is the 2nd-largest REIT behind Choice. REI has underperformed due to its retail holdings; they tried unsuccessfully to move in the U.S. They're getting more into condos now, which is good. He never bought this because it's all over the place. He prefers Smart REIT. Pays a 5.4% yield, so you can own it for the dividend only.

Canada's biggest commercial (malls) landowner in Canada's six biggest cities. Pays a 5.8% yield. It's moving from malls to mixed-use properties, like air use above their properties. They have the biggest redevelopment project in Canada now, in downtown Toronto. Low Beta. (Analysts’ price target is $28.38)

Canada's biggest operator of commercial properties, focussed in 6 high-income cities. They're pursuing density intensification: selling air rights to build condos and high-rises above commercial properties like malls.

Strong management that will be adding apartments of the highest quality in Canada. The dividend is safe. Yield 5%

The threat of e-commerce Yes, it's a threat, but late cycle these REITs do very well because central banks tend to cut interest rates. When the recession eventually hits, it will hit REITs hard. So, don't buy REITs now. They aren't cheap.

(A Top Pick Apr 30/19, Up 2%) He has 3 REITs and expects them to hold or trend a little upwards. You need to be a little defensive in the summer.

He thinks they are doing the right things. They have recognized the future of real estate is going to be into urban clusters -- coming office with retail and residential. They disposed off assets that did not fit the plan. The proceeds will be use to buy back stock and spending capital into new development opportunities. He would buy on weakness.

(A Top Pick Jun 28/18, Up 16%) It has been sort of their steady-eddy bond proxy. It is a defensive value play as retail is under pressure. Pays close to a 6% dividend. They are involved in redevelopment

Large retail player in Canada. Owns a small position, as they've expanded into mixed use development. Have sold assets to pay down debt and buy back shares. Building more apartment units. Residential and developmental potential.

He's moving into safety. It pays a 5% dividend, but don't expect much upside. The Canadian economy looks weak and rates will stay flat. He expects volatility and this is stable. (Analysts’ price target is $27.75)

A cheap stock that pays a 5.5% yield, It's re-rating higher. They are pivoting away from malls to mixed-use properties with condos on top--high-density buildings. (Analysts’ price target is $27.50)

This is the big one. It is a solid company with a long track record. They announced a couple of years ago they would sell secondary assets in secondary markets. They are trying to expand the types of users in their locations. He thinks they are making the right focus. The current COO will step in as CEO in the near future. He thinks cash flow growth could remain quite strong. It is not cheap so you could probably wait before you add more.

Never owned it, not because he dislikes it, but they're so large, it's hard to change what they own. For example, they bought then sold the U.S, and now they're buying Canada. He prefers SRU.U-T in the same space, but Walmart anchors them. In contrast, RioCan had to deal with the Sears and Target closings. SRT has rallied for the past few months, despite the Amazon effect, but still has room to grow. Nothing wrong with REI.UN, but he prefers SRU.U. Managment are also large shareholders.