Which REIT Can Grow Their DPU Over The Years?

Which REIT Can Grow Their DPU Over The Years?

Most of us invest in REITs for their dividend yield but what makes a REIT exceptional is the ability of the REIT manager to grow the distribution per unit (DPU) over the years.

Below are the REITs with their annual historical distribution (in cents) I have held in my stock portfolio. The historical distribution can be easily found from the individual REIT website.

As you can see from the line chart I plotted above using the historical distribution, Parkway Life REIT and Frasers Commercial Trust have been able to grow their DPU consistently over the years as the line shows a gradual incline slope. Mapletree Commercial Trust should be able to form an incline slope as well but the line shows a decline because the 4Q2017 results are not yet announced.

Distribution per unit (DPU)for CapitaMall Trust and Suntec REIT looks rather flat over the last few years which reflects the current outlook for shopping malls.

Distribution per unit (DPU)for OUE Hospitality Trust declines as compared to FY14.

As you can see, by plotting the chart, it gives us a high level overview which are the REITs that is capable of growing their DPUs 5 years or more.

FY12 FY13 FY14 FY15 FY16 FY17 % Growth
ParkwayLife Reit 10.31 10.75 11.52 13.29 12.12 13.35 29.5%
CapitaMall Trust 9.46 10.27 10.84 11.25 11.13 11.16 18.0%
Mapletree Commercial Trust 6.487 7.372 8 8.13 8.62 6.77 ** 4.4%
OUE Hospitality Trust NA 2.9 6.74 6.55 4.61 5.14 (23.7)% ^
Frasers Commercial Trust 6.69 7.83 8.51 9.71 9.82 9.82 46.8%
Suntec Reit 9.49 9.328 9.4 10.002 10.003 10.005 5.4%

^ Based on FY14 to FY17 since IPO in FY17

** Not the full year results.

Teach Your Kids to Spend, Save and Share

Teach Your Kids to Spend, Save and Share

Recently, I attended a parenting course organized by my neighborhood community center. One of the topic is to teach your children about financial literacy. Just like me, I believe many parents out there does not know where to start when it comes to teaching your children about money management. Did you ever experience your child spending all their allowances at school and ask you for more money to buy additional stuff such as Pokemon cards?

You can try this simple technique that I have learnt from the course, summarized in three words: Spend, Save and Share. These are three broad techniques which you can use to remind your child to make choices with their money. You can make the above money jars using recycled containers (PS: I used the empty containers after finishing up the Chinese New Year goodies).

With the money jars, you can show your child how to allocate the given allowance into different containers and also help them understand what the purpose of each container is. Here are the three categories:

#1 Spend

Buy things that you need and want now.

#2 Save

Set money aside to buy things in the future.

#3 Share

Donate money to help people or buy something to share with your siblings or friends.