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1Q 2016 income from S-REITs.

Tuesday, March 29, 2016

This is the first time I am blogging about income received from S-REITs in the first quarter of the year. So, what did I do in the S-REITs space in 1Q 2016?

Honestly? Nothing.

The last time I did anything was in December 2015 when I added to my position in Soilbuild REIT at 73c a unit which I thought was a fair price to pay.

In 1Q 2016, I received income from the following S-REITs:

1. AIMS AMP Capital Ind. REIT
2. First REIT
3. Saizen REIT
4. K-REIT
5. Suntec REIT
6. FCOT
7. Cambridge Ind. Trust
8. Cache Logistics Trust
9. Sabana REIT
10. IREIT
11. LMIR
12. Soilbuild REIT

Total received in 1Q 2016: 

S$ 379,630.94

This is really due to a bumper payout from Saizen REIT which will not be repeated.





Am I pleased that my patience has been rewarded or am I sad that I will no longer be receiving a regular income from a portfolio of freehold residential properties in Japan? 

Well, a bit of both, really. 

Yes, I have mixed feelings.

Now, what am I going to do with the money that came in? 

Start a few fixed deposits. I know that a 9 months fixed deposit at CIMB will pay 1.8% per annum and a 12 months fixed deposit in BOC will pay 1.9% per annum. UOB is offering 1.7% per annum for a 13 months fixed deposit. Yes, I know.

To fellow shareholders of Saizen REIT who are wondering what to do with the money, although it is important to have a war chest ready, remember to reduce the cost of holding cash while waiting for the next investment opportunity to come along.

Congratulations and good luck!

Related posts:
1. 2015 full year income from S-REITs.
2. A lesson on the right prices and luck.

39 comments:

Girish Sheshagiri said...

Congrats AK you're simply Brilliant

ted said...

Will you be selling the 'empty' stock?
Or wait for the escrow to release?

I'm wondering, after the escrow release, the stock will drop to maybe 1 or 0.5 cts.
Selling it will be a bitch, due to the min. $25 transact fee.
(I have very small position only :D)

Or just let it rot after the escrow release?

AK71 said...

Hi Girish,

I am sure my guardian angel works overtime. :)

AK71 said...

Hi ted,

I could sell but I am waiting to see what happens next. ;)

AK71 said...

From my FB page:

Benson Tan:
$300+k divy than how much $$$ he invest to get so much?

ASSI:
Saizen REIT calls it a special dividend but a big chunk is a return of capital. ;)

TP said...

Hi AK,

What would your estimate be the worth of each Saizen now?

Regards
TP

AK71 said...

Hi TP,

Off the top of my head, around 6.5c or 7c per unit, maybe.

Sanye ◎ 三页 said...

Hi AK,

Congratulation to the handsome dividend income. Will you be investing in other Reits to supplement the loss of income from Saizen?

AK71 said...

Hi Sanye,

Thank you. :)

If Mr. Market is willing to sell to me at attractive prices, I wouldn't mind adding to my long positions in S-REITs, of course. ;)

Siew Mun said...

Received $96,835.20 from Saizen special dividend which increase my war chest to about $250k. Put $50K 4-month FD @1.6% in BOC since Feb and $20k 6-month FD @1.6% in CIMB since yesterday. CIMB FD promotion ends on 31 Mar.

Stock Hunter said...

Hi AK,
As u said Saizen worth maybe 7 cents, will it be better to sell in the market which is offering 8.8 cents. Is there any other good reason not to sell besides the one u had mention.

AK71 said...

Hi Siew Mun,

I just plonked some money into a CIMB FD too. 9 months, 1.8% pa.

My BOC FD is maturing in another 2 weeks. :)

AK71 said...

Hi Stock Hunter,

Perhaps, I am being sentimental. Well, I could be.

I have gotten back all my capital plus a generous capital gain. So, I suppose that could be a reason why I don't feel any urgency to monetise the units on hand.

Good reason? Probably not.

Siew Mun said...

AK and SH,

On the contrary, I think Saizen at 8.8 cts is under valued. Call me an optimist. We have a remaining 1.146 (Liquidation Value) - 1.056 (Special Dividend) = $0.09. The manager and TMK is capping the extraneous claims at $2.5 million. Saizen has yet to distribute the dividends from 1 Jan 2015 - 4 March 2015 (being the completion date) which I estimate to be 0.0293/6*2 = $0.01, where $0.0293 is the last dividends from Jun-Dec 2015. Therefore the total value is about 10 cts (9cts + 1cts).

MPC said...

Hi AK,

Currently you have any new reits or trusts in mind to add to your portfolio if the market offers the chance to you?

AK71 said...

Hi Siew Mun,

Thanks for crunching the numbers. Appreciate it. ;)

AK71 said...

Hi MPC,

Well, all investments are good investments at the right price. ;)

cindy tan said...

Hi AK,

What do you think of Cache Log? Its price has been falling. Any thoughts on adding more units?

AK71 said...

Hi Cindy,

I have not been impressed with the REIT's management in the last couple of years or so. I am quite comfortable with holding on to my investment in the REIT which is a smallish legacy position but I am not sure about adding unless unit price falls a bit more (all else remaining the same).

Chula Sulagaesuan said...

Soilbuild seems to be dropping a lot after XD. Are you planning on adding in more? (:

AK71 said...

Hi Chula,

If the REIT's unit price were to decline much more, I would be sorely tempted. ;)

Siew Mun said...

Added SBiz Reit at 8,000x0.715 today from my SRS acct

DarrenNoob - said...

Wow, came across this blog by accident while reading stuffs about investment. After reading most of your posts, i quite suddenly realized i am not entirely alone in having the belief of creating passive income through a portfolio of stocks.

I only started studying about how stocks work 9 years ago. Before that all I know about shares and stocks were all the bad negative aspects about how people lose a lot of money, too much watching Hong Kong dramas ha ha ha.

But after an in-depth study, i realized the potential of creating passive income by creating a diversity of good dividends pay out stocks, I have limited resources as I am drawing an average income of 2k plus, but I do save a lot since started working. In 2008, economic crisis strike and I was able to grab some blue chips stocks shares like SPH, Venture Corps, OCBC and DBS at a bargain. It wasn’t much but it’s a start for a late comer in stocks investment, ha ha ha. After 9 years of building, I got a variety stocks giving an average of 15k dividends a year which is amount to around 1.2k per month. Hopefully by the time I reach 45, I can achieve 2.5k per month then I can fired my boss and kiss goodbye to those disgusting mountain of papers on my desk.

Although most would think of retiring but I still believe even after achieving my partial financial freedom, I should continue working to keep the mind and body active. But I will definitely look for a more meaningful job without any worry on paycheck.

Reading these blog certainly reinforced my belief.
Cheers. Mu hahahaha.

AK71 said...

Hi Darren,

Welcome to ASSI and thank you for sharing your journey thus far with us. :)

I always tell readers that if AK can do it, so can you. You are another great example of how if we want it badly enough, we will make it happen. Thumbs up!

cindy tan said...

Hi Ak,

Will you still add more Soilbuild reit given the latest news that it is sueing TOE for unpaid rent? Price has also dropped to 0.70.

AK71 said...

Hi Cindy,

I am in no hurry to buy more. Will wait and see. :)

Choon Yeow said...

Hi AK, thanks for sharing on your returns. Willing to share what is the return in %? If you strip out the one time from Saizen, what would it be? I think it is important to know the full context...else $300k earned based on $10M vs $1M capital would throw out a different picture....

Thanks.

AK71 said...

Hi Choon Yeow,

Various readers have asked this question over the years and I have always disappointed them. ;)

However, those who have followed my blog since day one could probably guess what the average dividend yield of my portfolio is. There are also newer readers who did a CSI on my portfolio, digging up my old blog posts, and came quite close too. ;p

Siew Mun said...

There is a deal brewing in Saizen announced in SGX 5 July:
"The manager (“Manager”) of Saizen REIT, wishes to announce that the Manager has received a written proposal in relation to a transaction. The Manager requires time to review and evaluate the merits of this proposal.

AK71 said...

Hi Siew Mun,

This is very interesting. Let's see. ;)

silas said...

Hi AK,

Is it ok to ask which are your top 5 holdings for S-REITS currently? Dont need any numbers though haha.

AK71 said...

Hi silas,

My top 3 holdings:

1. AIMS AMP Capital Industrial REIT
2. First REIT
3. Saizen REIT

Saizen REIT's value has shrunk a lot. So, it is less significant now.

I have smaller investments in a handful of other REITs. Never really ranked them. ;p

Don_Jerome said...

Hi AK

wanted to ask you about Soil build preferential offering. Are we allowed to apply for excess shares on top of the 1 for 10 we are entitled? If so, is there a cap to the excess we can apply for?

thank you!

AK71 said...

Hi DJ,

I believe we are allowed to apply for as much excess as we like. :)

Don_Jerome said...

Thanks AK! :)

silas said...

Hi AK,

May i know what was ur entry price for AIMS, First and Soilbuild REIT?

Before going into any REIT investment, is following closely to Dividend machines by the fifth person sufficient? Or TA is required as well?

Hope to grow my warchest like you to build up my REITS for passive income like you. But im not holding on to any stocks wondering when will a major correction be coming...

My investable sum is just sitting in my ocbc 360 account... lol dont know what to do next if there isnt a correction.

silas said...

Hi AK,

May i know what was ur entry price for AIMS, First and Soilbuild REIT?

Before going into any REIT investment, is following closely to Dividend machines by the fifth person sufficient? Or TA is required as well?

Hope to grow my warchest like you to build up my REITS for passive income like you. But im not holding on to any stocks wondering when will a major correction be coming...

My investable sum is just sitting in my ocbc 360 account... lol dont know what to do next if there isnt a correction.

AK71 said...

Hi silas,

I don't see why my entry prices should matter to you but if you really want to know, the answers are probably somewhere in my blog. So, do a search. ;p

Dividend Machines provide a structured approach towards investing in REITs. It is one way but we must not think that it is the only way. Someone who thinks that it is the only way would have missed out on Saizen REIT as an investment, for example.

If you know TA, it would be useful but it is not a must to know TA.

Wondering when the next major correction is coming? Just for fun, me too. ;p

We cannot predict, we can only prepare.

Remember, there are worst situations to be in than sitting on cash. ;)

Kevin said...

Hi AK and silas,

There is a course on Foundations of REIT Investing held by SGX on 24 October 2016 which will help you gain more knowledge.

It costs S$98 and SkillsFuture credit can be used to pay for it if you are a Singaporean aged 25 years old and above. ;)

http://i.imgur.com/x7e2fH2.png

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