How To Select Exceptional Industrial REITs

Dividend Investing Specialized Topic: REITs Investing In Search Of Exceptional REITs (Step B)
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Transcript

Let's do a quick recap on industrial rates. In a nutshell, they are the kind of reads that take care of the back operation of companies, be it for logistics storing or supply chain management purposes. Industrial reads serve various clients from SMEs to the MN C's and lately the e commerce clients hell. Recall that one of the major challenges that industrial read space is dealing with low quality tenants, the difficulty in collecting rent from them and how hastily they vacate the place whenever times are bad. Hence, exceptional industrial reads would therefore try to mitigate this risk by renting out their properties mainly to MNC s and e commerce businesses. They would rent out any leftover spaces to a diversified group of SMEs.

For this reason, if you are looking for an entity rate to invest in. Perhaps start by analyzing its tenant profile composition, which can be found in the quarterly reports issued by the reads. Look at the latest quarterly report. An exceptional industrial reads ideal tenant profile would look similar to this. Another sign of an exceptional industrial rate is that the ladder not only caters its buildings to mn C's but also caters to their needs. Well, how then do you tell whether the industrial retailers the MNC needs Well, remember that unlike with retail rates, it is not easy to simply walk into the industrial building and observe how well the business is doing.

Think about this for a while. Okay, ready? The answer is to refer to the annual report and analyze how the writer described the reads industrial buildings because an MNC is logistic neat. are more sophisticated. The industrial buildings are described as monitored and made to handle these complex needs. As such, seek out keywords like multifunctional layout, multi temperature systems, storage rooms, video surveillance, and other technologies that help reduce the tenants overall cost.

But what if you can't obtain such information on any of the reports issued by the industrial rate that you're considering? The answer is simply to call the investor relations team or ask questions during any meeting with the shareholders. Ask these three specific questions. How does their space add value to the MNC brands that they are serving? do their big tenants require special technology? And are they providing it in their buildings?

Do they communicate often with their tenants? If the answer is yes to all three questions, then you can be sure that the needs The MMC tenants are well met. Moving on to location pointers. Ideally, an exceptional industrial read will have their industrial buildings located near major airports, seaports and train stations. These are logistic gateways, places where goods come in and out of the country. The logic here is that the closer the industrial buildings are to these logistic gateways, the cheaper it is for businesses to get their logistics done.

Of course, much depends on the type of industrial buildings that we're talking about. If it's a business park, it should be located near universities and r&d Institute's rather than near a seaport. If it's a light industrial building, it should be located near residential areas so that mn C's need not spend the extra capital to transport their employees. You get the idea? Always ask why isn't industrial building located there? And what value can be derived from that location, lower costs, or perhaps quicker management of goods and so forth.

Let's apply the concepts. maple tree logistic trust is one good example of an exceptional industrial reads observe how their industrial buildings are placed. Look at this. Their buildings are near the seaports, business parks near research labs and a university. This is where I stay so I know the area. Notice their buildings are also located near the airport.

Let's move on to the management pointers. When it comes to industrial buildings, the management of tenants becomes paramount. Therefore, the management team of an exceptional industrial read tends to track and manage tenant leases actively. For instance, leases that are due to expire within the following two years the operation management will have an option Ongoing plan to retain desirable tenants while concurrently plan to reduce those undesirable ones. Examples of retaining desirable tenants would be seeking their feedback via surveys, evaluating their suggestions and offering improvements and incentives for them to renew their leases. Whereas for undesirable tenants, it will be the property management's job to remind these naughty tenants of the policy that they signed to remind them of the rules and regulations and to require a larger deposit in the next renewal or at worst carry out necessarily evictions.

The point here is that exceptional industrial reads are deeply hands on with managing their tenants. So do look for this management quality in the industrial route you're looking at. Once again, here's the criteria list for selecting an exceptional industrial route. In the next lecture, we will be touching on healthcare reads And how to select the best of them. If you are someone who prefers safe investments, then healthcare reads might just be your cup of tea.

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