# DIR.UN or NWH.UN?



## tombiosis (Dec 18, 2010)

Planning on adding some exposure to REIT's in my TFSA with new money. I have narrowed my choices down to the 2 reits in the thread title. The dundee reit has a "strong buy" recommendation and the nortwest has a "hold" rec. (Not sure I care about anylists anyway...)
If you had to pick one of these, which would you chose and why?
Thanks in advance for the replies.


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## HaroldCrump (Jun 10, 2009)

tombiosis said:


> The dundee reit has a "strong buy" recommendation


Just to be clear on the symbols, Dundee REIT is D.UN.
DIR.UN is Dundee Industrial REIT.
DIR acquired all the factory/industrial properties from D.UN last year.

NWH is health care properties like doctors' offices, labs, clinics, etc.

So they are different sectors.

On what basis have you narrowed your choices, can you explain?
Have you looked at AFFO, average mortgage term, occupancy rates, average mortgage rates, average cap rates, and similar metrics?


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## tombiosis (Dec 18, 2010)

NWH and Dundee Industrial Reit are listed as similar companies, or competitors, on globe investor. They have similar market caps and yields. NWH is categorized as "financial services" and DIR.UN falls under Real Estate on the globe investor "summary"...why would they be listed as "competitors" or "similar companies" if they don't fall under the same sector? I have not looked into all of the metrics you mention...what is "AFFO"?


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## HaroldCrump (Jun 10, 2009)

I don't know why NWH and DIR should be listed as competitors.
You should not accept the Globe Investor categorization on face value, without looking into it.
NWH is not financial services - that does not make sense.
Similar market cap and yield does not mean anything either - an oil company and a REIT could have similar market cap and yield.

AFFO is Adjusted Funds From Operation. It is a key REIT valuation metric.
http://www.investopedia.com/terms/a/affo.asp


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## tombiosis (Dec 18, 2010)

HC
I realize that similar market cap and yield doesn't mean anything when dealing with 2 completely different entities, but in this case, we are talking about 2 reits listed as competitors and as similar companies on globe investor summary...and yes, it does say "financial services"

http://www.theglobeandmail.com/globe-investor/markets/stocks/summary/?q=NWH.UN-T

Thank you for clearing up "AFFO" for me. The whole reason I started this thread was to learn how others evaluate before purchase...and to get thoughts on these 2 popular reits that are currently near their 52 week lows and might offer value right now. 
I also thought my query might illicit some other responses that might be educational for myself and other forum readers. I am always trying to learn as I go, and want to put some of my $ to work...everything seems so expensive right now, and reits are an area I think has potential upside, and it is a sector that will help me diversify my holdings. I did not check out every reit and write a manifesto on why I had narrowed it down to these 2 choices...they are both fairly liquid with good volume, popular, and might be a good buy right now.
If I was an expert and I knew how to analyse all these metrics I doubt I would be asking for thoughts on these reits. I would be too busy counting my money .No wonder most of the posts on this board are always from the same participants. God forbid asking a q without first memorizing all content on investopedia.


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## HaroldCrump (Jun 10, 2009)

I have no idea why NWH is classified as "financial services".
I would tentatively suggest that Globe's classification is _wrong_.

As for deciding to pick either (or both) stocks, since you are proposing to pick stocks, you have to research it.
Don't go only by Globe's recommendation, although it is perfectly ok to read analyst recommendations and analysis.

I didn't mind your question about AFFO at all.
I am happy to answer any other question you may have.

However, I think you should undertake some study of REITs and how to value them.
AFFO is one of the metrics (albeit one of the more important ones).

Also, I'd slightly disagree that NWH and DIR are liquid and popular.
They are both niche players.
NWH market cap is only 417M - it is definitely to be considered small.
Compare against $7.8B for RioCan or $5.9B for H&R or $3.10B for Dundee.

If you are looking for competitors for these, DIR's most direct competitor would be Pure Industrial (AAR.UN).
NWH's closest competitor will be Medical Facilities (DR), although they have most of the business in the US and maybe HLP.UN to some extent.


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## favelle75 (Feb 6, 2013)

tombiosis said:


> Planning on adding some exposure to REIT's in my TFSA with new money. I have narrowed my choices down to the 2 reits in the thread title. The dundee reit has a "strong buy" recommendation and the nortwest has a "hold" rec. (Not sure I care about anylists anyway...)
> If you had to pick one of these, which would you chose and why?
> Thanks in advance for the replies.


I have NWH.UN for a few months now, and I also have DR.TO. Both have been solid performers for me...I have no problems throwing more $$ into them at these levels either.


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## rossco12 (Dec 4, 2013)

I've been picking up Riocan and NWH.un lately. Riocan is rock solid. Two Harbors is another good one if you want some to look at if you want some US residential exposure (TWO).


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## Homerhomer (Oct 18, 2010)

I have been buying reits for few months now and my latest addition is NWH, however since it's a niche and very small I have created a position much smaller than my other reits (riocan and Dundee reit). I am eying chartwell and DIR as well. I am especially interested in chartwell due to demographics and would load up on it if it went down back below 10.


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