The Canadian real estate market continued to surge in 2021 in a consistently friendly credit environment. That climate may change in the New Year as the Bank of Canada sets its sights on higher interest rates. Regardless, I’m still looking to snatch up red-hot REITs as demand remains sky high.
Artis REIT (TSX:AX.UN) is a Winnipeg-based real estate investment trust that offers investors exposure to a portfolio of industrial and office properties. Shares of this REIT have climbed 14% in 2021 as of mid-afternoon trading on December 29. The stock has rebounded nicely after a sharp drop in late November.
The REIT released its third quarter 2021 earnings on November 3. It disposed of 27 industrial properties in the Greater Toronto Area (GTA) and a handful of industrial and retail properties in Winnipeg and Regina. Artis increased NAV per unit to $17.45 – up from $15.03 at December 31, 2020. Meanwhile, it boosted its adjusted EBITDA interest coverage ratio to 3.71 over 3.66 in the prior year.
Shares of this REIT last had a very favourable price-to-earnings ratio of 4.6. It is not too late for investors to snatch up Artis at a discount. Better yet, this REIT offers a monthly distribution of $0.05 per share. That represents a strong 5% yield. Investors on the hunt for undervalued REITs with nice income should look to Artis as we approach the New Year.
