Alternative income
“ The selling is overdone and historic dividends ought to be maintained , meaning the current valuations are throwing up some bargains ”
Andrew McHattie Investment Trust Newsletter publisher
become higher since interest rates have risen , hindering performance . Combined with slowing economic growth , unsustainable rental yields and the post-pandemic decline in demand for office space , it looks as if the storm clouds are gathering . McHattie points out that in the past year alone , Tritax Big Box REIT , Civitas Social Housing and Target Healthcare REIT are down by 37 %, 30 % and 28 % respectively . Portfolio managers say the falls are overdone and stability beckons , with interest rates expected to fall in 2024 , but McHattie feels trustspecific issues need to be taken into consideration . “ Investors have to weigh every case on its own merits – this is essential when prices do seem misaligned with NAVs , and some yields in the 7 to 10 % range look very enticing ,” he adds . “ But in many cases I do think the selling is overdone and historic dividends ought to be maintained , meaning the current valuations are throwing up some bargains .”
Issue 95 - May 2023 / 33 /