Money Reporter, MPL Communications Inc.133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846
We sometimes don't fully appreciate all the hard work that is done on our behalf
On page four of this Guide, we note that Pembina Pipeline Corporation (TSX:PPL) inked a $115 million deal in September despite having made a $110 million expansion decision the month before .
This kind of hard work is pleasing to us. As income investors, we just like to sit back and collect our steady stream of distributions and dividends, and watch our unit and share prices and payouts increase over the years. We don't often think that there is often furious and strenuous activity at the head offices of our companies by management to produce these steady increases. We appreciate the returns, but we don't as often appreciate the amount of effort that goes into producing those returns.
But there often is a lot of work going on on our behalf. In fact, Pembina didn't just ink one deal in
September : it inked two. The one we didn't mention on page four of this issue was consummated two days after Labour Day.
On that date Pembina acquired a 232-acre of well-developed industrial land in the Alberta Industrial
Heartland for approximately $20 million featuring a well-designed existing rail system an d utility infrastructure to support the future development of rail, terminalling and storage facilities, which the company calls the "Heartland Hub".
The land has in excess of 5,000 linear feet of rail track, currently serviced by CN Rail, and is adjacent to 160 acres of existing Pembina lands, which can be developed for future merchant storage and rail expansions. In addition, there is the ability to access over four million barrels per day of existing and future oil sands and conventional crud e oil supply through various cur rent and potential pipeline interconnection(s). All that for just $20 million.
Good for Pembina, and good for its share holders. PPL is a buy. But it's not the only company of ours that has been active lately.
On September 10, CAP REIT (TSX:CAR.UN) announced that it had complete d the acquisition of a portfolio of 338 apartment suites and 33,800 square feet of commercial and retail space in four properties in the city of Dublin, Ireland for a purchase price of approximately CDN $59.0 million, excluding transaction costs. All of the rental suites are modern, fully furnished, and include underground parking. Constructed betwee n 2006 and 2008, the properties are well maintained, secure, and centered around attractive communal landscaped courtyards and gardens. Occupancy at the properties is currently approximately 93.0%.
And on September 12, AltaGas Ltd. (TSX:ALA) confirmed an agreement to acquire a 25% strategic interest in Petro gas Energy Corp., a privately held North American integrated midstream company, for approximately $10 million in shares of AltaGas Ltd. and cash. The deal is expected to be meaningfully accretive to earnings and cash flow.
BestBuysThisMonth
?oe"H&R REIT $20.85 (TSX:HR.UN) Last month in this space we featured three REITs as Best Buys, and all three had gains over the next four weeks. The exception was H & R REIT: not listed as a Best Buy and its price declined 1.84 % on the month. This month we trumpet the owner of the Bow in Calgary, of Corus Quay and Scotiabank Place in Toronto, and the winner of the Primaris REIT sweepstakes. Yields 6.47 % .
?oe"CANADIAN OIL SANDS $19.98 (TSX:COS) As the price of oil-sands crude rises and falls, so rises and falls the price - and the payout - of Canadian Oil Sands. Investors in this company need to accept that fact, and focus instead on where COS is going as production in the WCS Basin continues to expand year after year. Yields 7.01% , and now 5.8% cheaper than it was a month ago.
?oe"RIOCAN REIT $24.17 (TSX:REI.UN) Also a Best Buy last month, at $23.83. H & R REIT and RioCan REIT are our two most favorite REITs. RioCan is a very classy organization with a satisfied unitholder base thanks to its stellar earnings record, string of distribution increases, the alignment of unitholder interest with the interests of management, and scores of high-quality properties, including some prized properties from Primaris REIT, which will add to funds from operations in the future. Yields 5.83 % .
Money Reporter, MPL Communications Inc.133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846