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Tuesday, August 13, 2019

Keeping my faith with AIMS APAC REIT

Used about half my proceeds from the Ascendas Htrust sale and added 100 lots of AIMS to my portfolio when it went XD @ 1.44.

In hindsight, could have waited a bit longer. The next day, it went as low as 1.41/1.42. Then again, thousand gold cannot buy early know.

I continue to be quite optimistic on AIMS.

Compared to ESR REIT, AIMS is arguably a safer play due to its comparatively lower gearing (33% vs 39% of ESR REIT). 

Furthermore, there is a lot of untapped GFA for AIMS properties.  One DBS Treasures report puts it as 600,000 square feet of untapped gross floor area.  This coupled with its substantial debt headroom makes AIMS attractive since it would have some flexibility to use debt to finance AEI or repurpose some of its assets to improve its NPI.

The other thing going for AIMS is that it is a relatively small cap player, with market cap of slightly less than 1B.  For perspective, Ascendas REIT market cap is 9.5B, Mapletree Ind is 4.5B and ESR is 1.7B. There is a distinct, and not entirely remote, possibility that AIMS may get acquired by a larger player, further unlocking value for shareholders. I would prefer that not to happen, because it would mean I have to find another 7% yielding investment, which is difficult in today's environment.


AIMS is now my second largest investment at 320k, only slightly lesser than my FCOT investment at 380k.  So I am unlikely to add even more unless there is a very compelling share price correction.

I have some funds left over from the Ascendas sale. Hopefully the present correction provides additional opportunities to buy discounted assets.

Onward to FI friends! 








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