Artis REIT: real estate investment trust with diversified portfolio of quality assets and experienced management team
Canadian commercial REIT lures Asian investors as it trims non-core assets to reinvest in newer properties
Artis Real Estate Investment Trust (Artis REIT) has been reporting stable and growing financial and revenue results since it started in 2004. Managing its portfolio of office, retail and industrial properties, Artis is one of the largest diversified commercial reits in Canada.
As a closed-end reit, it is focused on creating value through ownership and astute management of quality assets.
Holding 250 properties covering a total area of 26 million sq ft located across Canada and the United States, Artis has grown its portfolio value from C$15 million (HK$93.7 million) to C$5.5 billion.
The REIT’s management cited unparalleled experience and market knowledge as keys to its success. Posting double-digit returns and a year-to-date performance that surpasses the S&P/TSX Capped REIT Index by 12 per cent, Artis offers great value to investors by managing a large and diverse portfolio that can command premium market prices.
“Our team members are experts in commercial real estate,” says Armin Martens, president and CEO. “We work hard and are very productive. This continues to be an excellent time to be in the real estate business.”
To further boost growth, the firm plans to continue selling buildings at low yields. It is keen on trimming its non-core assets to reinvest in newer generation real estate while constructing modern buildings at higher yields. With ample liquidity available through recycling capital, Artis aims to grow its earnings without raising new equity.
“We are committed to our distribution and our balance sheet,” Martens says. “We will continue to upgrade our portfolio and our growth profile in a disciplined manner, to maximise shareholder returns.”
Last year, Artis sold and bought C$400 million-worth of properties at 6 per cent and 7.5 per cent yield, respectively. The 150 basis point spread adds up to about C$6 million of earnings growth, gained by just recycling capital in a disciplined and intelligent manner.
While investors gravitate towards high-yield retail funds for its tax-efficient structure, Artis is seeing an increasing level of interest for its securities from investors in Asian countries.
“I think the world is interested in Canada because of our good currency, inflation hedge, and growth profile in terms of real estate,” Martens says. “It is safe here, and with the country’s open borders, excellent culture, and promotion of innovation and diversity, opportunities for collaboration and success abound.”