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Canadian Apartment Properties Real Estate Investment Trust (CAR.UN)
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Chartwell Retirement Residences (CSH.UN)
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InterRent Real Estate Investment Trust (IIP.UN)
Q: I was looking to sell CSH.UN and buy either CAR.UN or IIP.UN because of its high payout ratio but I didn't because it started showing momentum. I recently heard on BNN that most reits have a high payout ratio so I wondered if I am being overly cautious.
Can I get your opinion on CSH.UN. should I be concerned about its high payout ratio? Would you sell it and buy one of the other reits.
I own all 3.
thanks
Can I get your opinion on CSH.UN. should I be concerned about its high payout ratio? Would you sell it and buy one of the other reits.
I own all 3.
thanks
5i Research Answer:
To maintain their REIT status, most do have high payout ratios. CSH at 77% (12 months) is not particularly concerning. That being said, we prefer that distributions have the ability to grow, and we would consider that potential still much better at the other two. But there's a tradeoff: both are more expensive than CSH and thus already offer lower yields. If all three are already owned, we would not see the need to make a move here.