The third part of my investment portfolio in which objective is to create wealth to retire.
Stock : Cambridge Industrial Trust
Vested in 2007 after it was listed in July 2006 with an IPO price of $0.68. Cambridge Industrial Trust is Singapore’s first independent industrial real estate investment trust (REIT) in industrial properties sector. Vested then at price of $0.88 and after series of rights issue plus scrip dividend till present, average holding price is $0.634 excluding dividend collected. With reference to its recent 3Q 2011 earning, projected DPU for 2011 is 4.293 cents which translates to 6.77% with reference to holding price of $0.634. As a REIT it is considered part of "income stock" in my portfolio. Cambridge Industrial Trust has assets across Singapore diversifies into assets class of logistic, light industrial, warehousing, industrial, self storage & warehousing and car showroom & workshop.
Potential Upside :
Cambridge Industrial Trust is not the top graded Industrial REIT in Singapore as compared with those of AscendasReit, Mapletreelog and MapletreeInd mainly due to no strong sponsors and quality of assets is relatively less premium. Nevertheless, it assets across Singapore with diversify assets class is sustainable in the long run. The demand of its assets is very much co-related with Singapore economy. In the event of Singapore economy returning to its blooming days whereby office rental increases and companies expansion, the demand for Cambridge Industrial Trust's properites will increase and thereby improving its rental income and capital appreciation of the share price. This is the potential upside for Cambridge Industrial Trust
Potential Downside :
Cambridge Industrial Trust with its industrial properties is pretty much cyclical in nature with its demand very much dependent on Singapore economy. As can seen from the 2008 global financial crisis, Cambridge Industrial Trust's balance sheet was stretched as gearing ratio was at the high end ( as of now, it still have a gearing ratio of 33.1% ). Without quality and yield-accretive assets being acquired due to lack of financial fundings ( lacking of strong sponsors ) is probably one of the downside risk for it. Hence, share price was taken a hit badly during the 2008 crisis.
Personal Expectation :
Expectation will be for the management to acquire more yield-accretive assets without stretching its gearing to growth the REIT. Despite being the only one of the stock in my portfolio to be still in the red presently ( even with the inclusion of dividend collected ), Cambridge Industrial Trust still able to maintain quite a constant dividend payout since listed till now. Given times, with the dividend collected, my investment on it should have no problem in turning negative to positive. For the time being, am satisfy with the annual distribution but in future would like to see capital appreciation for it.
Cambridge Industrial Trust
