Brookfield Office Properties Inc T.BPO.PR.A

RE:I'm looking for some NEGATIVE posts, Tell me why

[pierrelebel]

You asked "Tell me why not to buy. "

Too late for that since you have already purchased your shares and even added to your positions.

As stated several weeks ago, I prefer (and own) BPO.PR.T  as they reset at the end of this year based on the "Canada 5 year" rate in effect December 1st, 2023. I find it much easier to project a range for interest rate a few months from now than two or three years down the road.

I still conservatively expect "Canada 5 year" to trade in the 3.7% to 4.0% range three months from now.  This will result in a yearly dividend of about $1.72 to $1.80 for the next five years on BPO.PR.T. This dividend works out to a yield of 12.2% - 12.8% based on a current $14.00 market.

Other BPO preferred shares reset one, two or three years in the future and one has to wait years before getting the potential benefit of higher dividend at reset.

My current expectations are for interest rates to peak in late 2023 or early 2024, remain relatively high and steady for some time and start to decline later in 2024.  I do not expect to see 1% again (the result of stimulus needed to fight the pandemic) nor do I expect rates to keep climbing.

Whenever common or preferred shares offer such high yield on the market it is a red flag that higher risks exist.  One may not see them but the market does.

As such, one should be careful to diversify and only invest a relatively small postion of the portfolio in such high yield propositions.