Except that the Federal Reserve has indicated a few rate rises next year and here is the picture.
By compiling the interest coverage ratios of the REITs, it can be seen that Sabana Reit has the lowest interest coverage ratio of 2.63 and any increase in finance cost would hit it hardest.
Anyway, I do think that concerns about gearing is over-rated as looking at Ireit, it has a whopping high gearing of 42.5%, one of the highest among the REITs, and yet its interest coverage is also one of its highest and its dividend yield too. Besides, some REITs engage in issuing perpertual bonds which are not reflected in their debt.
Nothing interesting to buy so far!
