If you are wondering whether the office REITs on my Dividend Stock Tracker are getting more attractive, do understand that the price is a function of future cash flow and it seems Grade A office rents have seen some tapering.
In investing, you can’t make a buy or sell decision based on 1 quarter. There is a need to look at office rental in general fundamentally, layering that with the general trend going forward for the next few years.
Interestingly, CapitaCommercial Management did state that prime office is more defensive, so if you are new to office rentals perhaps taking a look at next few quarter reports for CapitaCommercial, Frasers Commercial, OUE Commercial and Keppel REIT would see if they are really as resilient.
Update: Some new pictures:
Capitacommercial shows some of the past rental rates. Imagine locking in for 15 years at $18.80!
The above shows the occupancy trend of CCT. It would seem excluding CapitaGreen, CCT had a fall in occupancy since they have tenants pre-committed to CapitaGreen.
Here is the supply trend going forward.
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Sillyinvestor
Sunday 6th of September 2015
Kyith
The av. Of rent is $11.
CCT has rent locked in for capital green for the next few years at minimum $11, raffles city av. Is super low sub$10. The other properties might faced some weakness but if I remembered correctly, none has rent above $12.
Not that I am rushing to buy... Just looking around so that I know what actually to get when time comes
Kyith
Sunday 6th of September 2015
thanks Silly Investor, I read a bit on Capitagreen and its locked in long. so this means this is not an orderly price correction. How long did they lock in for btw?
The problem is that, if this segment is so volatile, should we be in this segment at all. if we were to pick up what are we picking up for?