REITS: Capitaland Int Comm Trust Rights issue

 

Capitaland Integrated Commercial Trust held a rights offering of 56 units for every 1000 held. I applied for my allocation and for excess rights that was about 3x my allocation, thinking that was pretty optimistic. 

Surprisingly, the valid acceptances of the rights offering was pretty low at 82.0%. This is despite the strength of the Capitaland brand name and the quality of their portfolio. This meant that I got all the excess that I subscribed for.

As a result, my CICT position is large enough to qualify as a 'medium-sized' holding though I will only update my portfolio page at the end of the year.

REIT rally?

The 5-year chart of CLR ETF is informative. It shows just how far REITs have fallen and the recent rally is only a small recovery. If further FED rates cuts are not forthcoming (i.e. slower or smaller than market anticipates), there will still be some volatility. 

On the other hand, a value investor is more concerned with the fundamentals and whether people want to rent units in the buildings the REITs own, and whether customers (for retail/hospitality), went to visit those premises.