crikey plough its worse than i thought. I was using the 30 june 08 value but I see it went up to $1.5 billion with the yen at 65. Which means that a 10% devaluation is a $150million haircut given the 31 Dec 08 revaluations done by other REITs 10% seems a likely figure. i mean the JAP economy has absolutely tanked. At least half the leases are cancellable which is not an issue in Oz or US, though of course tenants can still fold up or walk. And lets not mention earthquakes!
of course the exchange rate movements make this a crazy beast to play. Problem is the$AUS debt also rise with the strong yen, but you don't haircut the debt! i dont like it one bit, it could get ugly. Why take the risk?
TSO is a much better high risk REIT play than GJT . the US and Jap economies are as bad as each other. TSO have now revalued and are line ball on the covenants, check out todays announcement. But the NTA is AUS$2.50 and they trade at 17.5c. Plenty of risk with this one as well.
these REITS are wild beasts. i love em, big money to be made. I'm buying into 8 to 10 all up. If you invested $100,000 in REITS now and got it right you could be getting $60K to $80k pa in distributions in a couple of years. secret is diversify.
GJT Price at posting:
$3.65 Sentiment: Hold Disclosure: Held
