TSX:REI.UN - Post by User
Post by
materialsgirlon Mar 06, 2021 1:11pm
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Post# 32736420
NAV of REITs
NAV of REITsThere are two classifcations of REITs.
A operators of a rental business.
They acquire and sell a numbe of buildings each year.
B operators of a rental buildings that also develop new
buildings on their own spare property or on newly acquired land
Most REITs now fall into the latter category
CRR.un CHP.un CRT.un REI,un HR.un etc etc
Here is the thing. Analysts find it very hard to appraise the development
aspect of the business. After all, it will be the 2030s befor a lot of it
will generate cash flow. What the analysts do with data that cannot be
measured is ignore it.
Therefore, my theory is that all of these REITs are undervalued.
The proportional value of the development assets may vary from 10%
to 25% of the whole company. The land bank of some of them is worth
a fortune.
We get this for free today and the value will be captured over time as
the properties are built and leased.
We have what I call a hidden tailwind but the wind is blowing
mat