DUNDEE REIT $39.04 (Toronto symbol D.UN; TSINetwork Rating: Speculative) (416-365-3535; www.dundeereit.com; Shares outstanding: 96.5 million; Market cap: $3.8 billion; Dividend yield: 5.6%) aims to sell off its industrial properties over the next 18 months, to focus on adding to its office properties.
Right now, Dundee owns 22.5 million square feet of office space across 175 properties and 5.7 million square feet of industrial space across 74 properties. The REIT’s industrial holdings contribute about 8% of its revenue. Dundee spent a total of $1.6 billion on property purchases in 2011, up from $900 million in 2010.
The trust’s growth-by-acquisition strategy adds risk, but it is steadily diversifying its holdings outside western Canada by purchasing more buildings in other parts of the country. At the start of 2010, about 70% of Dundee’s properties were in western Canada. That’s now down to less than 55%.
Dundee REIT is a buy.
