High occupancy levels support their yields

Article Excerpt

CHOICE PROPERTIES REIT $14 (Toronto symbol CHP.UN; Cyclical-Growth Payer Portfolio; Manufacturing & Industry sector; Units o/s: 668.2 million; Market cap: $9.4 billion; Dividend yield: 5.3%; Dividend Sustainability Rating: Above Average; www.choicereit.ca) is Canada’s biggest real estate investment trust with 756 properties, including 20 under development, for a total of 68.0 million square feet of retail, industrial and office space. Its occupancy rate is a high 97.7%. Choice Properties pays monthly distributions of $0.061667 a unit. The annual rate of $0.74 yields a high 5.3%. In the latest quarter, those payments accounted for a reasonable 83.2% of its total cash flow. Due to the additional properties, the REIT’s revenue in the quarter ended June 30, 2019, rose 10.1%, to $324.3 million from $294.7 million a year earlier. Overall cash flow improved 8.3%, to $151.8 million from $140.1 million. Choice Properties recently sold $381 million in new units at $13.15 a unit. Due to the extra units outstanding, cash flow per unit declined 9.1%, to $0.221 from…