As we can all see, the covid-19 pandemic has definitely hit the global markets hard. Nearly everything is on lockdown, which makes it hard for businesses to grow, or even survive. With that being said, businesses are having a hard time paying the rent, and with certain rules allowing for rent dismissal, certain industries aren't paying up.
Pandemic-proof sectors such as food and medicine (Walmart, Shoppers Drug Mart) have been going strong through this time, but other industries such as entertainment and clothing (Winners, Cineplex) are struggling to make timely payments. As such, different REIT's that are engaged in different sectors should be assessed individually.
For instance, take the Riocan REIT, which has holdings in shopping centers and mixed-use developments, has seen its stock price go from a stable ~$27 CAD plummet in late March and currently trade around $15.90 CAD on market close April 30.
I mean, this was bound to happen. With the Canadian government tight on social distancing rules and non-essential businesses closing, shopping malls were forced to close along with other retailers.
Is it time to buy? Well, because of the economic environment Canada is currently in right now, many REIT's have felt its impact with its share price dropping and some even being cut in half. Now would be the time to find quality REIT's at a discounted price, which should bounce back once government loosens restrictions and business is booming again. However, don't be in too big of a rush to go and invest all of your money until there is some sign that businesses can start turning larger revenue again. The covid-19 situation is definitely a unique one, and now is the time for people who've never invested before to get into the game
"The time to buy is when there's blood running in the streets" - Baron Rothschild
Any thoughts? Feel free to comment below