These 4 REITs are hitting new all-time lows: is it time to buy them?

REITs are a perfect investment vehicle for anyone who wants dividends.

With a requirement to pay out at least 90% of their earnings as distributions, REITs deserve a place in the portfolio of any income-seeking investor.

However, lately, this asset class is under pressure.

A combination of high inflation and soaring interest rates dampened REIT sentiment.

Investors are concerned about whether REITs can maintain their distribution per unit (DPU) in light of these cost pressures.

As a result, many REITs have seen their stock prices fall to yearly lows.

Here are four REITs whose stock prices have hit new all-time lows.

Investors who remain confident in their prospects may consider adding them to their buy watch lists.

Manulife US REIT (SGX: BTOU)

Manulife US REIT, or MUST, is a pure-play US office REIT with 12 freehold office properties in its portfolio spanning seven US states.

MUST’s total assets under management were US$2.2 billion as of December 31, 2021.

The REIT’s unit price is half its value since the start of the year and recently hit an all-time low of US$0.31.

Gross revenue for the first half of fiscal 2022 (1H2022) increased 10.6% year-on-year to $100.4 million.

Net property income (NPI) edged up 2.8% year-over-year to $57.6 million.

The DPU, however, fell 3.3% YoY to $0.0261.

The occupancy rate of the MUST portfolio was high at 90% as of June 30, 2022, but the physical occupancy rate was only 28%, with many employees working from home.

The REIT’s gearing stands at 42.4% with 85.7% of its borrowings at fixed rates.

United Hampshire US REIT (SGX: ODBU)

United Hampshire US REIT, or UHREIT, has a total of 21 grocery and convenience properties as well as two self-storage properties, all of which are located in the United States.

Total assets under management were $732.9 million as of June 30, 2022 (including an acquisition completed on July 28).

UHREIT saw its unit price drop to an all-time low of US$0.46 and is down 28.4% year-to-date.

In HY2022, gross revenue increased 18.5% year-on-year to $31.8 million.

The NPI rose 10.6% YoY to $22.6m, but the DPU fell 4.6% YoY to $0.0291 due to supplements and stipulated liquidated damages.

UHREIT maintained a high portfolio occupancy rate of 96.2% as of June 30, 2022 and had an overall leverage ratio of 38% with 80.5% of its debt fixed.

Elite Commercial REIT (SGX: MXNU)

Elite Commercial REIT owns 155 mostly freehold commercial properties in the UK with an AUM of £517.7 million as of June 30, 2022.

The REIT recently saw its unit price fall to an all-time low of £0.46 and is down 28.4% year-to-date.

Revenue increased 17.7% year-on-year to £18.7m, with distributable income increasing 9.7% year-on-year to £12.2m.

The DPU, however, was down 2.7% year on year to 2.56 pence.

The REIT’s gearing was 41.9% with 63% of its total loans fixed rate.

There is potential for rental income to rise in April 2023, with Elite reviewing rents with its tenants, many of whom have their leases indexed to the Consumer Price Index with a minimum increase of 1% and a maximum by 5%.

Cromwell European REIT (SGX: CWBU)

Cromwell European REIT, or CEREIT, has a portfolio of 110 industrial and office buildings located in major cities in countries such as France, Finland, Denmark, Germany and Poland.

The REIT’s assets under management amounted to €2.6 billion as of June 30, 2022.

The unit price of CEREIT fell to an all-time low of €1.49 and is down 40.7% since the start of the year.

The REIT reported a respectable set of HY2022 earnings, with revenue up 8.5% YoY to 107.4m and NPI improving 4.7% YoY to 67, 3 million euros.

The DPU rose slightly by 2.3% year on year to €0.08695.

Earlier this month, CEREIT announced the acquisition of a light industrial asset in Denmark and also finalized the divestiture of two logistics assets in Germany.

The occupancy rate of the REIT’s portfolio remained high at 95.4% as of June 30, 2022.

For 1H2022, a positive reversion of rents of 2.9% was recorded.

CEREIT’s overall debt stood at 38.6% with a low overall interest rate of 1.72%.

The total gross debt is fully covered and the interest coverage ratio amounts to 6.7 times.

Is it a good time to buy Singapore REITs? If you’ve thought about it, then our latest guide to REITs will be essential reading. This exclusive pdf report shows you why REITs are still great assets, what sectors to look for and how to find great REITs today. The information it contains can help you build a strong retirement portfolio. Click here to download it for free.

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Disclaimer: Royston Yang does not hold any shares in any of the companies mentioned.