REITs on solid ground

Guardian's Michele Robitaille cites attractive yields and reasonable valuations.

Sonita Horvitch 9 March, 2011 | 7:00PM
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 Michele Robitaille, senior portfolio manager at Guardian Capital LP, says that after their stellar performance over the past two years, Canadian real estate investment trusts are likely to produce a more modest showing this year.

"Still, in the context of income-generating equities, REITs remain attractive relative to other income-producing securities," says Robitaille, who is a member of Guardian Capital's equity-income team.

"The current average yield on REITs is 5.7%, she notes. This compares "favourably" with the yield on the DEX High Yield Bond Index (a measure of the Canadian non-investment grade fixed-income market) of 6.7%, the yield on the new S&P/TSX Equity Income Index of 5.3%, and 4.6% on BBB Corporate bonds, (which are investment-grade bonds.)

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Sonita Horvitch

Sonita Horvitch  

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