# H & r reit (hr.un)



## Homerhomer (Oct 18, 2010)

For the bottom feeders and REIT experts, anyone familiar with this one, hitting 52 week low today, has been recommended on BNN number of times (which in itself may be a sell signal), but just looking at the scary payout ratio I never wanted to look at it again, but it keeps coming back.

Any thoughts on this one.
Thanks


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## doctrine (Sep 30, 2011)

They're putting in a bid to acquire Primaris REIT. These type of mergers often reduce the stock price of the acquirer. H&R is offering a lot of cash so thats why its hurting their stock price. $750M is not a small amount of cash to a $4B REIT.


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## Homerhomer (Oct 18, 2010)

I realize that, however the stock has been pretty week even before that as of late. I am not asking about the action of the stock today, but the stock in general.:encouragement:


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## tojo (Apr 20, 2009)

I did a quick look at the offer: 

"Unitholders of Primaris will be entitled to elect to receive 1.13 stapled units of H&R or $28.00 cash per unit, subject to a maximum cash amount of $700 million."

If this is true, why is Primaris trading 26.41 - 26.75 today?


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## gibor365 (Apr 1, 2011)

tojo said:


> I did a quick look at the offer:
> 
> "Unitholders of Primaris will be entitled to elect to receive 1.13 stapled units of H&R or $28.00 cash per unit, subject to a maximum cash amount of $700 million."
> 
> If this is true, why is Primaris trading 26.41 - 26.75 today?


This is the question I also have?! it's clear 6% upside for PMZ.UN ... more than than the previous bidder in theory can increase bidding price above 28....


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## phrenk (Mar 14, 2011)

gibor said:


> This is the question I also have?! it's clear 6% upside for PMZ.UN ... more than than the previous bidder in theory can increase bidding price above 28....


No it isn't, because the cash portion of the bid has a limit of $700M. In addition, you need to consider that the stock portion of the bid is based on H&R's stock price. This was the same thing when Whiterock REIT was acquired by Dundee REIT. The cash portion was not guaranteed.

The previous bid by the Kingsett consortium was all cash. A cash bid, vs. a stock bid, vs. a cash/stock bid are very different and markets react accordingly.

As for this shift in strategy for H&R which just finished building The Bow (which almost ruined them during the financial crisis), this bid is just odd. Also, with a +100M break fee, unless the Kingsett consortium overextends itself, H&R will surely be the leading bidder.

The question to ask is : will this be accretive to H&R ? Answer is no.


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## HaroldCrump (Jun 10, 2009)

I agree with phrenk, I don't think this bidding war for Primaris is justified.
Esp. on a stock dilution basis for the H&R unit holders, who are already suffering.
They have reason to be unhappy.

The Dundee/Whiterock deal was different in many ways, esp. because Whiterock was underperforming and it made sense for a more seasoned and diversified operator like Dundee to buy them out.
Although, as a Dundee shareholder, I feel they could have done better elsewhere.


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## gibor365 (Apr 1, 2011)

phrenk said:


> No it isn't, because the cash portion of the bid has a limit of $700M.


So how this 700M will be split? If everyone would prefer cash, every shares holder will get 25% of portfolio in CASH and rest in HR shares? or I don't get something.?


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## tojo (Apr 20, 2009)

HaroldCrump said:


> I agree with phrenk, I don't think this bidding war for Primaris is justified.
> Esp. on a stock dilution basis for the H&R unit holders, who are already suffering.
> They have reason to be unhappy.
> 
> ...


I can't see how a Primaris shareholder can benefit from this. If you do the math, the current price of PMZ.UN reflects the price HR.UN with the conversion factor, which works out basically the same as the price of Primaris yesterday. If I want to own HR.UN I can just buy it on the market. I get no discount on HR going through this acquisition (or am I missing something?). Disclosure: I'm a Primaris shareholder...but what is in it for me when this deal goes through ?


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## gibor365 (Apr 1, 2011)

My speculation  700M is 25% of PMZ market value, so maybe we'll get 25% of holdings in cash ($28) and 75% in HR.UN shares (x1.3)? 
Don't have time now, but probably I need to write letter to PMZ.UN Investor relations ...


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## tojo (Apr 20, 2009)

gibor said:


> My speculation  700M is 25% of PMZ market value, so maybe we'll get 25% of holdings in cash ($28) and 75% in HR.UN shares (x1.3)?
> Don't have time now, but probably I need to write letter to PMZ.UN Investor relations ...


Yes, its actually 1.13 conversion, but using your formula and the current price of HR, the conversion price of PMZ.UN works out to about $26.70 which is equal to the current market price and more importantly the price of Primaris the last few days. Big deal I say...why even bother with this - it ain't helping me as a Primaris shareholder.


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## HaroldCrump (Jun 10, 2009)

BTW, welcome back tojo. Haven't seen you here for a while. Hope you are doing well.


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## zylon (Oct 27, 2010)

Kind of fun trying to piece the puzzle together; especially when I have no skin in the game.

This is a direct quote, but broken into bullets for easier understanding (for me) :smilet-digitalpoint


Under the terms of the Agreement, H&R will acquire all of the issued and outstanding units of Primaris for a combination of cash and H&R stapled units. 
For each Primaris unit held, Primaris unitholders may elect to receive either *$28.00 in cash, subject to a maximum amount of $700 million*, or 1.13 stapled units of H&R, substantially all of which would be received on a tax-deferred basis. 
If the maximum cash is elected, it will represent approximately 25 per cent of the total consideration. 
In the event that *Primaris unitholders elect more cash than is available*, the cash consideration will be prorated among those unitholders electing cash, with the balance of the consideration being settled in H&R stapled units on the basis of the 1.13 exchange ratio. 
Based on H&R's 20-day VWAP ended January 15, 2013 of *$23.99*, the value of each Primaris unit under the transaction at full proration will be *$27.33, consisting of $6.89 in cash, and 0.8518 H&R units (valued at $20.44). *
The transaction has been structured so holders of Primaris units will receive their H&R stapled units on a substantially *tax-deferred rollover* (the receipt of H&R Finance Trust units, expected to be less than 4% of the total unit consideration, will be taxable).

http://tmx.quotemedia.com/article.php?newsid=57300556&qm_symbol=HR.UN


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## tojo (Apr 20, 2009)

HaroldCrump said:


> BTW, welcome back tojo. Haven't seen you here for a while. Hope you are doing well.


Thanks Harold, likewise hope you are doing well. Haven't visited for a while but its nice to see this site has taken off :encouragement:.


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## blin10 (Jun 27, 2011)

it's actually a decent price to start a position in hr.un ...


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## gibor365 (Apr 1, 2011)

zylon said:


> the value of each Primaris unit under the transaction at full proration will be *$27.33, consisting of $6.89 in cash, and 0.8518 H&R units (valued at $20.44). *
> 
> 
> http://tmx.quotemedia.com/article.php?newsid=57300556&qm_symbol=HR.UN


So, if your calc is correct. there is 2.8% minimum upside from today closing price... imho if default option for PMZ.UN shareholders will be HR.UN units, investors who slects CASH, can get more CASH and less HR units...
In any case, I'm OK with getting some HR.UN shares, it's really cheap now and I like their policy increasing dividends on Q basis


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## phrenk (Mar 14, 2011)

tojo said:


> I can't see how a Primaris shareholder can benefit from this. If you do the math, the current price of PMZ.UN reflects the price HR.UN with the conversion factor, which works out basically the same as the price of Primaris yesterday. If I want to own HR.UN I can just buy it on the market. I get no discount on HR going through this acquisition (or am I missing something?). Disclosure: I'm a Primaris shareholder...but what is in it for me when this deal goes through ?


I listened a bit to the conference call today and H&R REIT management stated clearly that this transaction is not accretive (basically flat for H&R). Their motivation is is increasing their portfolio size and increased liquidity (shares traded or actual balance sheet cash flow, not sure), that's it.


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## Spidey (May 11, 2009)

blin10 said:


> it's actually a decent price to start a position in hr.un ...


That's what I did today. It's never been my favorite REIT, but I'm pretty well weighted with my favorites.


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## blin10 (Jun 27, 2011)

yah same, dipped my toes


Spidey said:


> That's what I did today. It's never been my favorite REIT, but I'm pretty well weighted with my favorites.


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## My Own Advisor (Sep 24, 2012)

I like HR.UN. What's not to like?

A nice mix of office, retail and industrial in the GTA and beyond.

Folks don't like some 5%+ yield and capital appreciation? Geez, tough crowd....


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## Spidey (May 11, 2009)

> I like HR.UN. What's not to like?
> 
> A nice mix of office, retail and industrial in the GTA and beyond.
> 
> Folks don't like some 5%+ yield and capital appreciation? Geez, tough crowd....




^ The thing that's always held me back from HR.UN is the debt ratio. But the property quality seems very good.


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## Sampson (Apr 3, 2009)

Spidey said:


> ^ The thing that's always held me back from HR.UN is the debt ratio.


They definitely 'maximize' their use of debt. Almost killed them with the Bow project and the credit crunch. But then again, no one else had money to gobble them up at the time, just us petty shareholders. Imagine what it would take to ever hit $7 again. Should have backed up the truck.


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## andrewf (Mar 1, 2010)

FMV of current properties plus properties under development is just a bit under $10 billion, with liabilities of $5.7 billion. A tad overleveraged, I'd say. But it suggests the units are fully valued at $4.3 billion.


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## Mall Guy (Sep 14, 2011)

What I don't like (as an H&R investor) is the sudden change in their investment strategy. Previously, they invested in long term, primarily single user properties. Primaris is almost 100% enclosed malls, many in secondary markets (i.e. Owen Sound, ON; Saint John, NB). H&R had nice geographic and economic diversification across a variety of markets and asset classes . . . but "A" malls in "B" and "C" market can be brutal, notwithstanding Target entering some of these markets.

Also, H&R had a strong major shareholder, and a hostel take over would not be possible. Primaris, just the opposite . . .


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## My Own Advisor (Sep 24, 2012)

I suspect this is a case of eating or being eaten. 

Just like we have an oligopoly of telcos and banks, REITs are next. I suspect we'll have a handful of big players 5-10 years from now. REI.UN, HR.UN, CWT.UN, D.UN, the Loblaws REIT and a few others will be 80% of the market.


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## andrewf (Mar 1, 2010)

There are also some big private real estate holders, like CPP, teachers, OMERS.


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## blin10 (Jun 27, 2011)

strange that it's going down when they take over quality assets ....


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## Doug2000 (Apr 6, 2011)

Purchased Friday @23.09, like the yeild.


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## Mall Guy (Sep 14, 2011)

blin10 said:


> strange that it's going down when they take over quality assets ....


perhaps some don't think the departure from their core strategy (long term single tenant retail properties, office and industrial), for malls that not many others want . . . Owen Sound, Sarnia, Kingston ON, Saint John, Atholville NB . . . just a few examples. Add tenant risk (Zellers, Sears, The Bay) and demographics are not a secondary market's best friend.


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## Mall Guy (Sep 14, 2011)

Take over now known as the "Club" deal. Any takers under $23.00 (closed $22.96 today for a 5.8% yield) ? May shore up my position . . .


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## gibor365 (Apr 1, 2011)

what do you mean by "shore up"?


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## Mall Guy (Sep 14, 2011)

. . . add a little on the pull back . . . not underwater at the moment, but current price would allow a little more breathing room. Have been a long time holder, rode my $26 entry price down down to $6.00 +/- . . . doubled down, and was above water around $12-15 . . . have added since. Don't like the apparent change in strategy, but by all accounts, Mr Hofstedter is a pretty smart guy . . . I just don't like the community enclosed mall space !


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## the_apprentice (Jan 31, 2013)

Bought on Friday for $22.95. Plan on holding it long-term.


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## none (Jan 15, 2013)

Agree?
http://www.theglobeandmail.com/glob...ing-a-short-term-opportunity/article10699290/


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## My Own Advisor (Sep 24, 2012)

Love HR.UN. It's got upside and a tidy 5%+ yield.


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## CanadianCapitalist (Mar 31, 2009)

My Own Advisor said:


> It's got upside and a tidy 5%+ yield.


Where do you see the upside Mark? I don't see much upside from REITs at these levels. They appear to be fairly valued when you look at metrics such as price-to-NAV or affo-to-bond-yields.


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## My Own Advisor (Sep 24, 2012)

I'm thinking more long-term, beyond this year, especially with the Primaris deal. 
http://www.primarisreit.com/sim-cms...ease_re_unitholder_approval_and_proration.pdf

I was fortunate to start buying HR.UN just over 3 years ago when prices were closer to $16. 

Agreed, NAVs are fairly valued now and so I don't intend to pile money into REITs this year. HR.UN is a hold.

You still hold some REITs? A REIT?


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## none (Jan 15, 2013)

Small tangent, I'm thinking I made an error in buying a big pile of AX.UN. i accidentally left my index investor hat behind. I may actually just dump it and go ETF - silly.

If REITs hay day is gone - what else in a couch potato would replace it?


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## My Own Advisor (Sep 24, 2012)

Zre? Xre? Vre?


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## AGHFX (Aug 31, 2012)

none said:


> I'm thinking I made an error in buying a big pile of AX.UN.


May I ask why you think buying AX.UN was an error? H&R is a great REIT but I prefer Artis at the moment. I feel it has larger upside and I can't complain about earning almost 7% by simply holding the stock.


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## none (Jan 15, 2013)

For no other reason than I feel like i'm breaking from what my wife and I decided would be a successful financial plan. Specifically, invest exclusively in diverse ETFs. Rather than go with one of the typical REIT ETFs I instead put our entire REIT allocation in Artis. It seemed a bit excessive.

Perhaps an alternate plan is to sell 75% of Artis and use that to buy into an ETF.


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## CanadianCapitalist (Mar 31, 2009)

none said:


> If REITs hay day is gone - what else in a couch potato would replace it?


The cheapest one available. That would be VRE. 

You can also hold REITs at even lower costs if you unbundle them. Pick the top 4 or 5 biggest names and invest equal amounts that total to your REIT allocation. Rebalance once every year if necessary. I personally unbundle because I'm willing to take the risk of underperfomance in exchange for a much lower cost of holding. Let's say you have $50K allocated to REITs. VRE will cost you $180 or so per year. Unbundling will cost you $40/$50 or less.


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## Sampson (Apr 3, 2009)

CanadianCapitalist said:


> Let's say you have $50K allocated to REITs. VRE will cost you $180 or so per year. Unbundling will cost you $40/$50 or less.


This is pretty minimal savings, 0.24% per year. I would bet the under performance of the unbundled set could easily exceed a few 100 points.

I am also curious what upside everyone sees in the REITs. With continued threats of a double dip and incomplete recover in the US, in addition to possibility of faltering economy (no Canadian REITs are injecting into new capital projects), and the possibility of correction in Canadian residential coupled with the loss of consumer confidence, I see lots of potential for downside.

Where is the upside? Without the new capital projects, without a new economic boom, without the prospect of curbing expenses (down during the last downturn), where is the improvement on top and bottom lines going to come from?

If you want yield, it is always there, and presumably somewhat stable for most of these companies, but upside in addition to the payout?


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## andrewf (Mar 1, 2010)

I think we're going to see 5 years of muted consumption growth due to maxed out debt levels. This will put a damper of new retail development and rents. From my understanding though, the office market is still tight in many markets and rents should increase nicely.


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## AGHFX (Aug 31, 2012)

That's the benefit of owning a diversified REIT. I sold RioCan and bought Artis because I didn't see much more upside (in the foreseeable future) in retail properties. Commercial and industrial properties still seem viable.


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## none (Jan 15, 2013)

AGHFX said:


> That's the benefit of owning a diversified REIT. I sold RioCan and bought Artis because I didn't see much more upside (in the foreseeable future) in retail properties. Commercial and industrial properties still seem viable.


so what allocation do you guys think is reasonable? I assume 100% Artis for the potato is not quite right.... 25% Artis and 75% VRE?


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## doctrine (Sep 30, 2011)

BPO is my pick in the real estate area. The downside to them is they have a lower dividend (but also only pay out 50% of FFO), but they are trading at a 15% discount to NAV which is increasing by 5-6% a year and is now around $20/share. They've been very cautious with their dividend but based on the book value going above $20 for the first time, I like the value of the stock at $17.xx.


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## AGHFX (Aug 31, 2012)

none said:


> so what allocation do you guys think is reasonable? I assume 100% Artis for the potato is not quite right.... 25% Artis and 75% VRE?


I'm not familiar with VRE but you should look at what REITS it holds. This also depends on how much money you want to invest in REITS (a dollar amount). If it's something along the lines of $10k then I would recommend investing in maybe 3 REITS. If it's less than maybe 2, and if it's more than.. well.. more than 3. The idea behind appropriate diversification is to minimize unsystematic risk. Of course this has to be done across sectors/industries, but it is important to diversify within sectors/industries. I emphasize _appropriate_ diversification because if you buy two REITS that invest in the same type of real estate in the same cities, you have no effectively diversified. I, personally, hold AX.UN as my North American REIT and I hold DI.UN for some Euro exposure (DI.UN is invested in German real estate). I am not suggesting you buy these because of my personal preferences. But I recommend you look at how you are diversifying when you look at different REITS. Ask yourself - where are they geographically? what type of real estate do they hold? are they in the acquiring phase or maintenance phase? do they have proper tenant diversification? (quarterly/annual MD&As provide this helpful information and only takes a few minutes to read). Just make sure you're not buying two similar REITS or you are effectively doubling your risk exposure.


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## My Own Advisor (Sep 24, 2012)

VRE has a 0.35% MER. That's not very much to pay but why not hold the REITs directly?

Within VRE:
RioCan = 16%
BPO = ~ 13%
H&R REIT = 9%
Dundee = 7%
Calloway REIT = 6%.

Those are about 50% of VRE holdings. As those REITs go, so will VRE, XRE and ZRE, for the most part.

Investing in REITs, proportionately, is not the same as investing in XIC for the Canadian market. Meaning, it is very difficult to corner the CDN equity market unless you have a very large stock portfolio vs. XIC. With Canadian REITs, you can own a few and forget about owning a REIT ETF and save yourself the money management fees.

@doctrine, I own BPO as well. Do you keep this is in USD $? I got in around $12 and wish I had more money at the time to buy more. Ah well.


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## fatcat (Nov 11, 2009)

like cc and others, i have also unbundled since i hold a long time and don't want to pay even .35
i am still tweaking but am trying to get diversification not by market cap but by category
i own dundee, for international, canadian apartment for apartments and riocan for retail
i am looking at morguard na for usa apartments and health lease for health
and perhaps granite for industrial (magna)


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## HaroldCrump (Jun 10, 2009)

fatcat said:


> health lease for health


Health Lease is primarily senior care centers.
If you are interested in core health care properties, consider NorthWest Health Care (NWH.UN).
They recently acquired GT Canada Medical Properties (MOB.UN) and now have international diversification in Germany, New Zealand, and Brazil.


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## blin10 (Jun 27, 2011)

i don't get why last dividend was $0.05x ? will next one be 0.11x ?


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## stephenheath (Apr 3, 2009)

From the News Release, if I'm reading it correctly, the total is the same, it's just split in two individual payments for this month because of the buyout:

TORONTO , March 19, 2013 /CNW/ - H&R Real Estate Investment Trust and H&R Finance Trust ("H&R") today announced that their respective Trustees have declared two distributions payable in the month of April 2013 totalling $0.1125 per stapled unit, representing $1.35 per stapled unit on an annualized basis. Payment of the first distribution, in the amount of $0.05625 per stapled unit, will be made on April 15, 2013 to H&R unitholders of record on March 28, 2013 . Payment of the second distribution, also in the amount of $0.05625 per stapled unit, will be made on April 30, 2013 to H&R unitholders of record on April 16, 2013 . 

The next distribution is being paid in two tranches as a result of the expected closing, in early April, of the previously announced acquisition (the "Acquisition") by H&R of certain properties of Primaris Retail Real Estate Investment Trust ("Primaris"). In connection with the Acquisition, H&R expects to issue stapled units for delivery to electing Primaris unitholders which unitholders will thereafter become entitled to receive monthly distributions from H&R. The timing of these distributions is intended to align the distribution record dates and payment dates of H&R and Primaris.


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## blin10 (Jun 27, 2011)

ah ic, thanks


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## blin10 (Jun 27, 2011)

nice pop today :>


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## physik3r (Sep 10, 2012)

blin10 said:


> nice pop today :>


I don't see any news suggesting why this is occurring. Any thoughts?


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## blin10 (Jun 27, 2011)

physik3r said:


> I don't see any news suggesting why this is occurring. Any thoughts?


I think funds are making big bets on rei.un and hr.un , both had big moves lately and rei broke 52week high today...


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## blin10 (Jun 27, 2011)

blin10 said:


> I think funds are making big bets on rei.un and hr.un , both had big moves lately and rei broke 52week high today...


how quick things can turn.... anyone buying at these levels?


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## My Own Advisor (Sep 24, 2012)

Great time to buy. 

Been DRIPping this one for a while now. Bought this a couple years ago for TFSA. Been very happy with it.


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## andrewf (Mar 1, 2010)

Indeed. The first clue should have been all the retailers tripping over themselves to IPO REITs. I wonder if Loblaws is a month too late.


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## kcowan (Jul 1, 2010)

H&R are converting their debentures due June 2017 at 6% for $19, and replacing them with a series due 2018 for 3.35%. Should be good for the stock price.


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## gibor365 (Apr 1, 2011)

I got small amount of shares as a result of PMZ.UN transaction.. looking that HR dropped 17% in last month, maybe it's time to add some shares, it's trading in 52 weeks low


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## Killer Z (Oct 25, 2013)

I have been looking to add to my REIT allocation. I currently own VRE, with a small position in REI.UN too. The plan is to slowly unbundle VRE into 3-4 REITs. HR.UN looks to be nicely priced right now, with a consistent history of dividend growth. Any thoughts on starting a position at its current price of $21.48/share?


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## gibor365 (Apr 1, 2011)

I was adding HR.UN and REI.UN recently


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## My Own Advisor (Sep 24, 2012)

gibor said:


> I was adding HR.UN and REI.UN recently


Adding every month via DRIPs and will continue to do so.


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## gibor365 (Apr 1, 2011)

My Own Advisor said:


> Adding every month via DRIPs and will continue to do so.


via DRIP too  HR.UN gives 3% discount on DRIPs, REI.UN 3.1%, but don't have enoigh shares to DRIP even 1 share, so adding....


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## My Own Advisor (Sep 24, 2012)

Add away, good prices now as you well know!

Synthetically DRIPping 4 REITs. Not planning on buying anymore at this time.


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## gardner (Feb 13, 2014)

Any idea why HR.UN dropped 4% today? I don't see any news.


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## 0xCC (Jan 5, 2012)

gardner said:


> Any idea why HR.UN dropped 4% today? I don't see any news.


CWT.UN (Calloway) and REI.UN (RioCan) are also down 2.5%-4% today. I am also confused.

Trade deficit numbers? Oil being down? Dollar losing over 1% to USD? None of those should really impact a domestic REIT in the short term.


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## Canuck (Mar 13, 2012)

interest rate related. All they've been talking about on BNN today is that rates are going to rise soon. Whole markets selling off, especially rate sensitive reits & utilities.


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## AltaRed (Jun 8, 2009)

Forget the talking heads on BNN - financial pornography at its best (worst?). 

Look at what has been happening this past week on bond yields instead. http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/


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## 0xCC (Jan 5, 2012)

Wow, some of those yields are up almost 50% in the last week.


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## gardner (Feb 13, 2014)

I am underweight in REIT at the moment and I guess I'll have a chance to load up on a few. I bought HR.UN yesterday, though, and am kicking myself looking at the price today. I may wait for things to settle down.


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## 0xCC (Jan 5, 2012)

The REITs I am watching are still much too expensive for my tastes. I'd like to seem them drop another 10%-15% (even though I own them now).


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## KaeJS (Sep 28, 2010)

It is definitely due to the interest rate scare.

I picked up some REI.UN a bit too early, but it's not a huge concern to me as it will inevitably go back up again. I'll be happy to collect 5% to wait.


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## Daryl (Feb 14, 2015)

AltaRed said:


> Forget the talking heads on BNN - financial pornography at its best (worst?).
> 
> Look at what has been happening this past week on bond yields instead. http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/


Financial pornography :biggrin: best laugh I've had all day. 
PS. Thanks for the link too!


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## andrewf (Mar 1, 2010)

Canuck said:


> interest rate related. All they've been talking about on BNN today is that rates are going to rise soon. Whole markets selling off, especially rate sensitive reits & utilities.


Didn't BOC just cut rates?


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## AltaRed (Jun 8, 2009)

andrewf said:


> Didn't BOC just cut rates?


The money market overnight rate about 6 weeks ago. Bond yields are often influenced, but not determined, by the benchmark rate as they were 6 weeks ago. Bond markets have decided it is bunk and have moved off in their own direction. Too much is made of central bank overnight rates.


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## Synergy (Mar 18, 2013)

I've been trimming my REIT exposure and adding to US financials and CDN Life Insurers. Everytime we get some positive news out of the US, REIT investors start having a little hissy fit. US Financials and CDN Lifecos tend to go in the opposite direction.


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## godblsmnymkr (Jul 15, 2015)

is there anyway to get a tax breakdown on how the units will be taxed for 2015? looking at their history, the tax breakdown is all over the place. it makes it difficult to consider investing in this...


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## kcowan (Jul 1, 2010)

I am pretty sure there is no easy way. You have to keep track of ROC to know your ACB. It should be easier. If anyone knows how, I am all ears.


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## gardner (Feb 13, 2014)

I have not used this, but it claims to do the business: http://www.acbtracking.ca/


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## donald (Apr 18, 2011)

Was looking at Reits lately 
H&r lost it's placed in the aristocrats(Mullen corp also Mtl.to)
Stand alone,not company specific 
The movement of funds and screening going to cause anything with in the next while or has this taken place already slowly already
was announced late late week
Any Meaning??


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## donald (Apr 18, 2011)

Cant stand typing in this text late late
last.....


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## 0xCC (Jan 5, 2012)

I'm not entirely sure I understand how the Canadian dividend aristocrats list was determined. Potash was added in this last set of changes and the changes were announced very close (if not after) the announcement from Potash that they were going to cut the dividend by more than 30%. I would expect Potash to get dropped next year but that was an unfortunate sequence of events for S&P Dow Jones Indicies (the company publishing the index).
http://finance.yahoo.com/news/p-dow-jones-indices-announces-221500260.html


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## pastorash (Feb 3, 2014)

I'm slowly building up a collection of stocks in my RRSP, haven't purchased a REIT yet, the only major sector left I haven't bought. Considering this stock but wondering if anyone has a article they can point me to on the basics of investing in REIT's, in particular the whole "rate sensitive" aspect of them.

Thanx in advance for your help!


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## My Own Advisor (Sep 24, 2012)

http://www.myownadvisor.ca/looking-income-dont-want-landlord-try-reits-101/

http://www.myownadvisor.ca/reits-book-value-net-asset-value-revealed/

http://www.advisor.ca/investments/market-insights/how-interest-rates-affect-reits-177397


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## pastorash (Feb 3, 2014)

Thanx very much, great primer, and proves it will be another great addition to my (more and more) diversified portfolio of dividend producing stocks.

Now if my income tax refund would just appear in my bank account...


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## pastorash (Feb 3, 2014)

Income tax arrived, bought @ $21.65 for an effective 6.18% yield. Seems good to get that after a few years of no dividend growth, crossing my fingers for the near future on that token.


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## Eclectic12 (Oct 20, 2010)

kcowan said:


> I am pretty sure there is no easy way. You have to keep track of ROC to know your ACB. It should be easier. If anyone knows how, I am all ears.


The easy way is to use one's broker "cost" or "book" numbers ... though there can be a couple of issues. 

If the Reit was bought under a different account then transferred to the broker, the "cost" numbers are reported to be FMV on the day of the transfer, not the real ones. 

Even if one bought the Reit using the broker, some brokers update the cost column for RoC and some don't.


Having seen errors in the past and having updated my bookkeeping with a yearly task to do these updates - I keep my own records as only I care as much for my money and getting the tax right.

Then too, where the calculated numbers match the broker's numbers ... one can have a better degree of confidence.


Cheers


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## Eclectic12 (Oct 20, 2010)

pastorash said:


> Thanx very much, great primer, and proves it will be another great addition to my (more and more) diversified portfolio of dividend producing stocks ...


There is also the trade-off of bookkeeping in a taxable account versus what is typically paid.

Doing the bookkeeping for something like RioCan that over the last ten years has paid a high percentage of the distribution as "income" and/or "other income" (taxed the same as interest or employment income at a higher rate) - I moved this into my TFSA. It looks like 2015 takes the record for most highly taxed income as between the two types, it adds up to 70% of the payments are highly taxed.

Reits that have a consistent history that has most of the payment as RoC ... in a taxable account likely means that almost all of the cash paid can be used for things like paying down the mortgage as the tax implication is pushed off until the units are sold (and will be taxed as CG). Even if the cost falls negative so that future payments are to be reported as CG, it is taxed at a better rate plus other capital losses (CL) can be used to offset, if not eliminate the CG tax.


Once I had the process/bookkeeping worked it ... it seemed a win-win to have between 70% to 100% of the cash paying down the mortgage today, with a tax advantaged bill coming when I sell.


Cheers


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