Topic: How To Invest

Dividend Advisor Hotline – Friday, June 23, 2023

Article Excerpt

ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST, $20.56, Toronto symbol AP.UN, remains a buy. The REIT owns 199 office buildings and 13 properties under development, mainly in major Canadian cities. Starting with the January 2023 payment, Allied raised its monthly distribution by 2.9%. The new annual rate of $1.80 a unit yields a high 8.8%. The REIT has agreed to sell three datacentre properties in downtown Toronto for $1.35 billion. It expects to complete the transaction by September 30, 2023. Allied will use $1 billion of the proceeds to pay down its long-term debt of $3.85 billion (as of March 31, 2023). That’s a high 142% of its $2.72 billion market cap. The remaining cash of $350 million will help fund Allied’s capital spending plans for 2023 and 2024. The sale of these buildings will significantly increase Allied’s taxable income for 2023. That will require it to pay a yet-to-be-determined special distribution to unitholders of record as of December 31, 2023. Allied has raised its annual distribution…