Two Income Trusts: 1 Buy, 1 Hold

Article Excerpt

DUNDEE REIT $36.65 (Toronto symbol D.UN; SI Rating: Speculative) (416-365-3535; www.dundeereit.com; Shares outstanding: 20.8 million; Market cap: $762.3 million) owns and operates 6.3 million square feet of office, industrial and retail properties. It now holds 40 office buildings and 37 industrial properties. The company is now focused on mid-sized urban and suburban office and industrial properties in western Canada. Earlier this year, it sold its Ontario, Quebec and Newfoundland properties to GE Real Estate for $2.4 billion. As part of the transaction, GE Real Estate bought $165 million of Dundee REIT units at $47.50 per unit. GE Real Estate now holds a 16% equity interest in Dundee REIT. Revenues were $39.6 million in the three months ended September 30, 2007, up 34.4% from $29.5 million a year earlier. The best measure of operating performance for a real estate company is cash flow. Dundee’s cash flow per share in the latest quarter was $0.58, up 3.6% from $0.56. Dundee pays a distribution of $0.183…