One analyst believes Dream Impact Trust (TSX:MPCT.UN) will have a moat around it as it is difficult to replicate its ‘impact status’
Capital Ideas Media | June 15, 2021 | SmallCapPower: As part of the Dream group of real estate investment trusts, Dream Impact Trust (TSX:MPCT.UN) describes itself as Canada’s first publicly-traded impact investment vehicle – making real-estate investments that both generate positive financial returns (targeted development yields of 15-20%) and aim to have a positive social and/or environmental impact.
Dream Impact has a pipeline of developments located in the Greater Toronto and Ottawa areas, about 80% of which is residential, with an opportunity to partner with governments and obtain favourable cost of capital through ‘green’ loans and government programs.
TD Securities analyst Lorne Kalmar recently initiated coverage on Dream Impact Trust with a “Buy” rating and a target price of $7.50 per unit saying, “We believe that the Trust’s target mix of assets, along with its ‘impact status’, will allow it to find a home in more and more institutional and individual investor portfolios over time.”
“In the meantime, with a 6.3% distribution yield, we believe that unitholders are being well-compensated as they wait for the valuation to improve.”
Mr. Kalmar added that he believes the Trust will have a moat around it as it is difficult to replicate its ‘impact status’, while also saying the Trust is currently trading at a 30% discount to his Net Asset Value estimate.
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