Dennis Mitchell is a portfolio manager with Sentry Select Capital Corp. Today we look at the Sentry Select REIT Fund.
Total assets $146.8-million
Globe 5-Star Rating 3 stars
TOP FIVE HOLDINGS
Dundee REIT 5.49%
Holloway Lodging REIT 5.11
Mainstreet Equity 4.79
Canadian REIT 4.7
First Cap. Real. Corp. 5.5% Bond4.63
|Fund||Group||S&P/TSX real estate|
First Capital Realty (FCR-TSX) $24.96
First Capital has a 14-per-cent discount to net asset value and 6-per-cent free cash flow yield. It's a company with strong internal growth, a great management team and a defensive asset class.
Brookfield Properties (BPO-TSX) $21.42
Brookfield hasn't rallied with other U.S. names, but it does have a strong office portfolio and management team.
Artis REIT(AX.UN-TSX) $15.75
This REIT has had a huge selloff, and promises great internal growth potential, Mr. Mitchell says.
PAST PICKS: DEC. 22, 2006
(Results include total returns)
Holloway Lodging REIT
Then: $ 5.20 Now: $ 3.95 -15.9%
Extendicare REIT (EXE.UN-TSX)
Then: $14.76 Now: $12.18 -10.7%
Killam Properties (KMP-TSX)
Then: $10.16 Now: $ 8.57 -11.8%
Mr. Mitchell sees 2008 North American real estate returns affected by credit market volatility and the U.S. slowdown. He says Canadian REITs are trading at attractive valuations and should benefit from global real estate fund flows. He sees strong returns early in the year driven by rate cuts and RRSP fund flows, and more fundamental buying in the latter half of the year after another round of subprime write-offs.
© 2007 The Globe and Mail. All rights reserved.
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