Stock Idea…WPT Industrial Real Estate Investment Trust…WIR.U on the TSX

Stock Idea…WPT Industrial Real Estate Investment Trust…WIR.U on the TSX

Price: 13.31

Market Cap: 624.7 Million
Yield: 5.71
Investment Type: Small Cap Income

Company Profile

WPT Industrial Real Estate Investment Trust (the REIT) is an open-ended real estate investment trust. The REIT is engaged in the business of acquiring and owning industrial investment properties located in the United States. Its objective is to provide Unitholders with an opportunity to invest in a portfolio of institutional-quality industrial properties in the United States markets, with a particular focus on distribution industrial real estate. The United States industrial real estate sector consists primarily of single-story properties located in or near major cities. The REIT's portfolio is concentrated in the Midwestern and Southeastern regions of the United States. It owns a portfolio of investment properties consisting of approximately 15.1 million square feet of gross leasable area (GLA), consisting of over 50 industrial investment properties and approximately two office properties, located in over 10 states in the United States.

The Investment Case

WPT is an industrial REIT that is a great play on the growth of online shopping. A few of its largest tenants are Zulily, Amazon and General Mills. The stock presently yields 5.8 per cent and trades at a discount to both the Canadian and U.S. peers on a multiple of funds from operations. The occupancy rate is at 98 per cent and the same property growth posted in Q3 was 2.9 per cent. The company also recently renewed and expanded their agreement with Amazon, which bodes well for future visibility.

Peter Imhof

WPT owns and operates an institutional quality portfolio of industrial properties located in the U.S. We see good visibility on increasing rents, lease terms and occupancy providing earnings and dividend growth for WPT investors. Demand for advanced warehousing, logistics to meet e-commerce secular growth is still in early days. The REIT trades on the TSX in U.S. dollars and yields over 5 per cent yearly.

Robert Lauzon

Morningstar Profile

http://quote.morningstar.ca/quicktakes/Stock/s_ca.aspx?t=WIR.U&region=CAN&culture=en-CA

Company’s Website

http://investors.wptreit.com/CustomPage/Index?KeyGenPage=390997