June 20, 2019

Boardwalk Real Estate Investment Trust (BEI)

The Boardwalk Real Estate Investment Trust (BEI) is the largest public owner/operator of multi-family rental units in Canada.  Boardwalk’s portfolio includes properties in Alberta, British Columbia, Saskatchewan, Ontario and Quebec.  All together the REIT owns over 230 properties that total well over 35,000 units, and 30 million feet square of income-producing assets.  Like the rest of the real estate investment trust market in Canada, the Boardwalk REIT seeks to provide value to investors by providing outstanding dividend income that takes advantage of Canadian tax laws.  These tax loopholes allow REITs to provide their unit holders with profits before they are subjected to business taxes.  They are also constantly on the outlook to expand their portfolio in the most advantageous way possible, taking into consideration the substantial asset base they already have in place in order to provide maximum long-term value to shareholders.

 

For many investors the Boardwalk Real Estate Investment Trust (BEI) represents the perfect low-maintenance way to get exposure to the real estate market.  In the past, in order to diversify into the real estate sector most investors had to look at purchasing a rental property.  While this is still an attractive option to some, for many the time commitment involved with being a landlord is beyond the scope of what they are prepared to perform.  Another factor that a potential real estate investor has to take into consideration is the reality that when you buy a rental property you are locked into that specific area in terms of your real estate exposure.  By comparison, when you look at the Boardwalk REIT, your investment dollars are immediately diversified across housing units that span all of Canada.  I believe this is fundamentally a less volatile, and much easier way of getting into the real estate market.

 

At Boardwalk’s (BEI) most recent press conference, the Trust announced that it would be providing discounted rental units to individuals who were displaced by the terrible fire in Slave Lake, Alberta.  “We are pleased to work directly with both Alberta housing and Capital Region Housing Corporation to contribute housing for victims who have lost their homes in Slave Lake as a result of the unimaginable tragedy that has taken place,” said Sam Kolias, the CEO of Boardwalk REIT (BEI).  He went on to say that, “We commend the Province of Alberta for their prompt response to this unprecedented emergency situation.”

 

Boardwalk is probably the most popular purely residential REIT.  It has an extremely large market capitalization of over $2.5 billion.  Right now the Trust is trading between $50 and $51.  Its $1.80 annual dividend gives the Trust a 3.6% yield.  This is a great option if you want exposure to the greater Canadian residential market, but in terms of an overall investment, I would probably recommend one of the more diversified REITs that offer much higher return on your investment in the form of attractive dividend yields.