REIT is a safe and low risk investment

Why I say that invest in REIT is very safe and low risk? REIT offer an average return of 6-8% annually for their shareholder. The rental received from the property will pay to investor by semi-annual or quarter basis.

Let me show an example. For Atrium REIT, it listed on March 2007.

Income distribution announced on:

18-07-2007 - 2.0 cents
19-10-2007 - 2.2 cents
17-01-2008 - 2.3 cents

Atrium REIT already paid out 3 quarters income distribution as 6.5 cents. So, its annual return is 6.5/3X4= 8.67 (equally to 8.67 cents)

Now, as at 19 January 2008, Atrium REIT closed at 98.5 cents.

Return for Atrium REIT = 8.67/98.5
= 8.8%

As compare to FD (fixed deposit), the interst rates is only 3.7% annually. When we invest on REIT, we can receive 8.8% which is 5.1% higher than FD rates. For future, the increase of rental rates will increase the income distribution for investors.

So, why not we invest on REIT rather than put our money in FD.

What types of investor are you?

Do you know what types of investor are you?

1. Conservative investor - maximize your return without assuming additional risks.
2. Moderate investor - seek out safer investments and earn a steady income.
3. Aggressive investor - take bigger risks looking for larger gains or higher return.

Going For Dividend Play

1. Public Bank berhad
2. Berjaya Toto Berhad
3. LPI Berhad

Swee Joo Berhad - To gain from palm oil

Swee Joo Bhd's recent entry into palm oil transportation is expected to give it a revenue boost, thanks to the bullish outlook for crude palm oil (CPO).

The Sarawak shipper's future in transporting palm oil from east Malaysia to various parts of the region “remains bright” on rising demand for the commodity, MIMB Investment Bank said in its strategy report for 2008.

MIMB, which has a “buy” call on the counter, estimates “liquid transportation” contributing about 9% to Swee Joo's revenue from the financial year ending Sept 30.

It said with limited available land in Peninsular Malaysia, it was the Government's plan to tap sizeable land in east Malaysia to plant oil palm, making the two states important palm oil producers in the near future.

At present, Sarawak had developed some 600,000ha of new oil palm estates, which were at various stages of maturity, it said.

Already, Sarawak is now the fourth largest state by area planted with oil palm, with the State Government aiming for one million hectares in the next few years.

Also, the Government expects the country's CPO production to reach 20 million tonnes by 2020 from 15.88 tonnes in 2006.

“This is expected to be driven by the increasing contribution from east Malaysia,” thus boding well for Swee Joo, MIMB added.

The company will begin its venture in palm oil transportation with two tankers of 7,000-tonne capacity each, the first of which Asia Star was delivered last August.

The second, Asia Bright, is expected to be delivered within the first quarter this year. Asia Success, the third tanker with 12,700-tonne capacity worth US$22.1mil, was ordered from China in December with expected delivery in June.

YNH Property Sell Its Menara YNH

YNH Property Bhd is finalising the sale of the proposed 45-storey iconic Menara YNH at Kuala Lumpur's Jalan Sultan Ismail for RM1.5bil.

Sources said investors from Australia, Singapore and a Middle-Eastern country were likely to form a consortium to purchase the building, which is scheduled for completion in 2012.

“YNH Property is also close to finalising a deal to secure a partner to jointly construct the building.

Artist’s impression of Menara YNH

“The partner, either from Hong Kong, Singapore or New York, is likely to hold a 20%-30% stake in a subsidiary company to be formed,” they told StarBiz.

Earlier this month, YNH Property announced the commencement of earthworks for the project and the allocation of RM4.2mil to relocate the water pipes and manholes at Jalan Sultan Ismail to make way for the tower project.

Menara YNH, to be built on three acres next to the Shangri-La Hotel, is designed to accommodate a single office block and a retail centre.

Each floor plate will have an area of 55,000 sq ft, which is among the largest in the world.

Menara YNH will have a total net lettable area of about 1.2 million sq ft.

The sale of Menara YNH is expected to have a significant impact on the YNH group, which has a share capitalisation of over RM1bil, based on the current share price of RM2.81 per share.

Over the next two years, YNH Property expects its projects, such as 163 Service Suites in Kuala Lumpur and Ceriaan Kiara in Mont' Kiara, to generate over RM400mil in revenue.

Plantations Stock Rally

Currently, CPO price shooting up to sky high RM3,280. What will be the next trend of CPO and plantation stock price moving?