Assets grow more valuable if they are able to churn out a higher level and consistency of cash flows, therefore, rental rate increases (also known as “reversion rates”) are a common method for REITs to grow their portfolios organically. Another method is to engage in what is known as “asset enhancement initiatives” or AEI. Source: Starhill Global REIT earnings presentation. Verdict: Fail. 6. Portfolio Occupancy Rate Check. Check for: Healthy portfolio occupancy rate. Starhill Global REIT’s latest occupancy rate is strong at 96.5%. Having said that, the rate could be higher if not for the drag from the Singapore office portfolio, whose occupancy stood at 89.2%. Given that REITs have outpaced the S&P 500 by 1.6% a year since 1972, such a mean reversion would not be that surprising. Should REIT investors hope for falling rates, then? Among industrial Reits, Cambridge Industrial Trust includes new leases - for existing spaces taken up by new tenants in place of outgoing tenants - but Viva Industrial Trust and Ascendas Reit do not include new leases in their rental reversion calculations. Some Reits deviate from providing rental reversions in percentage terms. Investors seeking to estimate the value of a real estate investment trust (REIT) will find that traditional metrics such as earnings-per-share (EPS) and price-to-earnings (P/E) do not apply. In
16 Dec 2018 So which inflation rate should we use? I would say REITs should at least achieve positive rental reversion of anywhere between 0.5% to 1.6% 18 Nov 2019 The REIT managed a 22.5% rental reversion rate for its Hong Kong retail portfolio and a 30.2% rental reversion rate in its China retail portfolio. 5.48, 5.17, 4.98, 4.70. Gearing ratio (%), 20.3%, 20.6%, 21.50%, 26.4%, 27.20 %, 28.60% Rental reversion rate (%), 7.4%, 7.2%, 7.6%, 10.9%, 16.3%, 32.1%.
22 Jan 2020 Real estate investment trusts (REITs) have long been valued for the industrial sector have seen largely positive rental reversion rates and
Composite reversion rate: The percentage change in per square foot average unit rent between old and new leases on the same store. The concept is a lot like the same store sales growth rate, only from a landlord's perspective, you are more interested in the growth of rent rather than sales. Assets grow more valuable if they are able to churn out a higher level and consistency of cash flows, therefore, rental rate increases (also known as “reversion rates”) are a common method for REITs to grow their portfolios organically. Another method is to engage in what is known as “asset enhancement initiatives” or AEI. Source: Starhill Global REIT earnings presentation. Verdict: Fail. 6. Portfolio Occupancy Rate Check. Check for: Healthy portfolio occupancy rate. Starhill Global REIT’s latest occupancy rate is strong at 96.5%. Having said that, the rate could be higher if not for the drag from the Singapore office portfolio, whose occupancy stood at 89.2%. Given that REITs have outpaced the S&P 500 by 1.6% a year since 1972, such a mean reversion would not be that surprising. Should REIT investors hope for falling rates, then? Among industrial Reits, Cambridge Industrial Trust includes new leases - for existing spaces taken up by new tenants in place of outgoing tenants - but Viva Industrial Trust and Ascendas Reit do not include new leases in their rental reversion calculations. Some Reits deviate from providing rental reversions in percentage terms. Investors seeking to estimate the value of a real estate investment trust (REIT) will find that traditional metrics such as earnings-per-share (EPS) and price-to-earnings (P/E) do not apply. In
Assets grow more valuable if they are able to churn out a higher level and consistency of cash flows, therefore, rental rate increases (also known as “reversion rates”) are a common method for REITs to grow their portfolios organically. Another method is to engage in what is known as “asset enhancement initiatives” or AEI. Source: Starhill Global REIT earnings presentation. Verdict: Fail. 6. Portfolio Occupancy Rate Check. Check for: Healthy portfolio occupancy rate. Starhill Global REIT’s latest occupancy rate is strong at 96.5%. Having said that, the rate could be higher if not for the drag from the Singapore office portfolio, whose occupancy stood at 89.2%. Given that REITs have outpaced the S&P 500 by 1.6% a year since 1972, such a mean reversion would not be that surprising. Should REIT investors hope for falling rates, then? Among industrial Reits, Cambridge Industrial Trust includes new leases - for existing spaces taken up by new tenants in place of outgoing tenants - but Viva Industrial Trust and Ascendas Reit do not include new leases in their rental reversion calculations. Some Reits deviate from providing rental reversions in percentage terms. Investors seeking to estimate the value of a real estate investment trust (REIT) will find that traditional metrics such as earnings-per-share (EPS) and price-to-earnings (P/E) do not apply. In A positive rental reversion rate is good for the REIT because it signifies that new tenants are willing to pay higher rents compared to existing tenant rates. Similarly, negative rental reversion rates may signify flagging demand or oversupply in the rental markets. Rental reversion refers to the renewal of expiring leases by existing tenants at a rental rate that is either higher or lower than the previous rate. Positive reversion is good news for a REIT as it means that rentals are on a rising trend, while negative reversion usually points to lower demand for space within a property or maybe a result of