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Dream Global REIT: A Low-Risk Company With An 6.74% Yield

Balal Rasool profile picture
Balal Rasool


  • Exposure to Europe with low risk.
  • Relatively safe 6.74% distribution yield.
  • Safe and expected to growth in the coming years.

It has been more than two years since I started investing and a bit more than two and a half years since I found a great passion for the stock market and the world of investing. Now that I am 20 years old, I started building a portfolio of companies that I like and that I think have a great future ahead of them. Since a lot of my investments are growth companies to mitigate my risk, I wanted to invest in companies that are less risky than my other investments.

I found out about Dream Global REIT (TSX: DRG.UN), (OTCMKTS: OTC:DUNDF) from one of the services offered by the Motley Fool Canada.

Nowadays, the market rises to new records every couple of weeks. People who speculate about the future of the market fall into two different camps: the bear market and the bull market. Thus, it is hard to find an investment that will be good in the bear market as well as in the bull market. Well, I believe Dream Global REIT is an excellent investment with great upside and a relative safe distribution yield for the next couple of years, especially better than cash or gold.

Dream Global REIT is a real estate investment fund focused on the commercial office market and industrial market in Germany and the Netherlands. The most prominent market for Dream Global is Germany with about 70% of their portfolio. Germany has a solid economic growth and has a very low-interest-rate compared to Canada and the United States. The same goes for Netherlands. The second biggest market is the Netherlands, with about 20% of their portfolio. Dream Global has been acquiring more and more property every year since its IPO.

Source: Company Presentation

This year alone, they have acquired 135 properties to expand in

This article was written by

Balal Rasool profile picture
I am a student. I have been investing for about 3 years still learning every day. My goal as an investor is to have financial freedom.

Analyst’s Disclosure: I am/we are long DUNDF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Before investing in any companies, please do your own research.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (31)

Balal Rasool profile picture
Sorry BoomBoom99 if it felt misleading, it was not intended. I am looking for changing the yield on the article. I initially wrote 6.74%, but, while reading articles about Canadain companies that I follow, I noticed the yield was always of the OTC Markets so I decided to write the yield shown on SeekingAlpha (http://bit.ly/2BnZR1b) which was 8.69 when I was writing the article. Sorry if it felt misleading. Any other feedback will be really appreciated. Thanks

Trapping Value profile picture
Just one quick point.
You mentioned the currency risk, but they are hedged for the next 30 months using EUR/CAD forwards so that will not be an issue.
joesmith323 profile picture

There is currency risk out past the 30 month hedge period but that is one of the reasons I bought DRG.UN. I want the Euro exposure.
Trapping Value profile picture
I do want Europe exposure, but I am indifferent to Euro exposure.
They keep extending their hedges keeping their forward hedges at the same level, but of course if Euro weakens a lot they may have to reconsider whether they hedge into that or risk riding it out.
Trapping Value profile picture
"Relatively safe 8.69% distribution yield"
The yield is 6.74%, I get small differences due to a lag between article being published, but that is a big and misleading error.
joesmith323 profile picture
Probably the result of dividing a Canadian dollar distribution by a US dollar price for DUNDF. It happens more often than it should on Seekingalpha.

On the positive side the article seems to be generally well written.

I am long DRG.UN. I hold it in my tax deferred account so I don't have to worry about the nature of distributions. I like that it gives me some European and Euro exposure without having to worry about with holding tax etc.
Trapping Value profile picture
It was the yield shown on SA couple of days back on the OTC price.
That is usually incorrect.
I am not sure how the yield is calculated but it is not the exchange rate adjustment.
Dream global does all the hard work for you, right on their home page.
Balal Rasool profile picture
At the time of writing, the yield was 8.69% for DUNDF. It took time to review and to publish the article since it was my first time. And, yes the distribution yield for DRG.UN is 6.74%. Sorry if it felt misleading, it was not intended. Thanks for the feedback. I will keep this in mind next time I am writing. We always learn from our mistakes.
anthonymaw profile picture
I'm long Dream Global REIT myself too but it's worth noting for tax purposes that the returns are a combination of dividends, capital gains and occasionally return of capital.
Balal Rasool profile picture
Thanks for reminding about taxes issues that come with holdings like Drem Global REIT. I didn't think of that since my holding in Dream Global REIT is in a free tax saving account.
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