# Killam properties



## AMABILE (Apr 3, 2009)

I am thinking of purchasing KMP
anyone care to dissuade me from buying it


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## dubmac (Jan 9, 2011)

Why Killam? 
Rather than dissuade you, what is it that made Killam a potential holding. It appears that they rent suites, apts to individuals mostly in the Maritimes, and Eastern Canada. If Killam were renting in a place like Ft. MacMurray where the local economy is quite healthy then I would "get it". Why not choose ZRE or XRE?


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## fatcat (Nov 11, 2009)

AMABILE said:


> I am thinking of purchasing KMP
> anyone care to dissuade me from buying it


sure ... don't buy it


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## doctrine (Sep 30, 2011)

I own KMP. Despite the macro economic pressures on the Altantic provinces, KMP is doing just fine there with occupany and rent prices. They are also expanding into Ontario. I think they are a great buy with a 6% yield here. Long term there will probably be a small 3-4% dividend increase every couple of years as well (last ones Dec 13 and Jun 11).


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## AMABILE (Apr 3, 2009)

I want this REIT for my portfolio
want an individual stock
not an index fund
not a .UN trust
pays a high yield of 5.96%
has P/E of 13
close to it's 52 week low


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## Killer Z (Oct 25, 2013)

Michael Missaghie is a REIT analyst that I enjoy listening to, and he believes there are better opportunities elsewhere in this sector. If you want an individual stock and wish to avoid the ".UNs", he really likes First Capital Realty (FCR).


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## doctrine (Sep 30, 2011)

FCR is good too. FCR and KMP are my two real estate companies. Another lower-yield alternate is Melcor Developments (MRD), which has better growth (and currently a better P/E) than both of them.


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## AMABILE (Apr 3, 2009)

thanks killer, I already own FCR


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## fatcat (Nov 11, 2009)

i own FCR also ...


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## My Own Advisor (Sep 24, 2012)

Same, FCR fan. Little cap appreciation though.


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## AMABILE (Apr 3, 2009)

If KMP falls below $10, I may have to buy it
since no one has convinced me yet, not to.


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## londoncalling (Sep 17, 2011)

me too


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## bettyboop (Dec 13, 2011)

I have some but I'll buy more


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## doctrine (Sep 30, 2011)

Sigh. Killam is voting to convert to a REIT, which will likely be successful. 

http://www.stockhouse.com/news/pres...oposed-conversion-to-a-real-estate-investment

Too bad, I appreciated the dividend tax credit and easy accounting in my non-registered account. Sold my 1950 shares today, moving on. Bought back into Alaris, which I sold in 2013 at $28.50, now back in at $27, with a dividend is 30% higher than when I sold (on a per share basis) thanks to new investments so basically able to maintain the yield KMP->AD.


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## andrewf (Mar 1, 2010)

Won't the REIT have a higher payout than the current corp structure due to the favourable tax structure?


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## doctrine (Sep 30, 2011)

Higher payout yes, but that is offset by no tax credit. Works well in RRSP/TFSA because you don't pay the taxes on the higher payout, but I was holding it non-registered for some real estate exposure. May jump back into FCR if it drops below $18 again.


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## andrewf (Mar 1, 2010)

But you are no worse off now, without the credit, since the corp is no longer paying income tax, but instead flowing through to you to be taxed in your hands.


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## doctrine (Sep 30, 2011)

Forgot to mention, they aren't increasing the payout at least to start (not mentioned is what they're doing with the tax savings), so I am worse off in the short term and I'd rather just shift the 6% yield into something more tax efficient while non-registered. Good company though. I had kind of hoped it would have been bought out before it decided to convert.


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## My Own Advisor (Sep 24, 2012)

You can always get in later doctrine. That's my plan....once the conversion happens, before they ramp up distributions, buy some inside the TFSA.


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## besmartrich (Jan 11, 2015)

My Own Advisor said:


> You can always get in later doctrine. That's my plan....once the conversion happens, before they ramp up distributions, buy some inside the TFSA.


I used to live in one of Killam properties in Nova Scotia. Although I was pretty happy while staying, the company is in net income downward trend and the stock seems more expensive than other real estate companies. So I would wait until the conversion happens and probably consider adding it to TFSA.


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## Ponderling (Mar 1, 2013)

I had re-balancing to do in my rrsp ( my company stock, which I used to hold for the management bonus that came with the holding, has been all bought up in the process of my company being bought out by a public company ). I bought Killam , as well and Northwest Medical, some RioCan, and a bit of FirstService Corp. We already held Canadian Apartments reit, and FCR.

I am trying to be a bit more exposed to Real Estate since I know my bond holdings will be sinking as the US economy finally look set to reignite interest rate increases


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## bettyboop (Dec 13, 2011)

I sold my shares today, I don't like to hold REITs in my regular account.


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## londoncalling (Sep 17, 2011)

I know interest rate increases will be a headwind for REITs. As mentioned on another thread, rent controls are attached to inflation rates. I am doing some preliminary screening for potential REITs to buy later this year. I have a fairly long list to whittle down but KMP came across my screen along with ERE, CAR, BEI, and IIP. I haven't looked at Killam in years. Does anybody still follow it?


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## KaeJS (Sep 28, 2010)

I own it.
I also added to my position today at 18.12? I believe.


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## KaeJS (Sep 28, 2010)

As an aside...

I really love their embarkment in Ontario.
As an Ontario resident, I have been in many of their buildings. Well maintained. Clean. Nice. Higher scale.

They also have new developments all over in great locations. I'm a fan.


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## Ponderling (Mar 1, 2013)

KMP just sits in the RRSP perking out divvys along with about 8 other reits. We own about $12-18k in each one. Once one hits 18K we usually look around to see why, and often give it a haircut down to 12 and pour the funds into other reits that might currently be down on luck at the time but with modest term better hopes.

I put an extra 5k into KMP in the depths of summer 2020, and when reits clawed their way back as covid stock panic faded sold the extra 5K for a good little perk.


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## doctrine (Sep 30, 2011)

In 2012 and 2013, KMP had 72 cents per share in funds from operation. In 2020, they had 83 cents and in 2021, they had 90 cents. 

In a decade of record real estate prices and big rent increases, they've only increased FFO per share by 20-25%? REITs are victims of dilution and trying to grow bigger, and I feel that by making so many acquisitions at the top of the market, many REITs have prevented shareowners from benefitting from massive increases in the valuations of the underlying units. KMP has been a regular issuer of equity for over a decade.

KMP has been a decent investment despite this, but a lot of it has been from stock multiple gains and not underlying gains in the assets themselves. I have just become very skeptical of the income+dilution model.


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## londoncalling (Sep 17, 2011)

Thanks all for your input. I am not in a hurry to add to REITs at the moment. Sounds like owners are content to hold. @doctrine's comments reminded my of CPG. Great yield and growth until it wasn't. I don't think it is to the same extent with REITs but important to be mindful as to how and why companies are growing.


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