Apartment REIT: author increases stake in Canadian Apartment Properties REIT

The author bought 80 units of Canadian Apartment Properties REIT, bringing the model portfolio holding to 200 units, and sold a small South Bow position while swapping a U.S.-listed dividend ETF for a Canadian S&P 500 ETF.

The author made several portfolio adjustments during an early spring review. They reinvested accumulated cash and simplified the model dividend portfolio. The changes include adding to a Canadian apartment REIT holding, selling a small spun-off position, and replacing a U.S.-listed dividend ETF with a Canadian S&P 500 ETF. The article explains the market context behind the apartment REIT move and says the updates will be reflected in the next model portfolio publication. Key actions: - Purchased 80 units of Canadian Apartment Properties Real Estate Investment Trust at Tuesday's closing price of $38.40 for $3,072, bringing the model portfolio total to 200 units. - Sold the portfolio's South Bow Corp. shares (originating from a October 2024 TC Energy spinoff) for proceeds of $838.58 at Tuesday's closing price; 23 shares had been added after the spinoff. - Replaced the iShares Core Dividend Growth ETF (DGRO-A), which trades in U.S. dollars on a U.S. exchange, with the BMO S&P 500 Index ETF (ZSP-T), adding 144 units of ZSP and a small residual cash amount; ZSP trades in Canadian dollars on the Toronto Stock Exchange. - The article reports that CAP REIT has a described strong balance sheet, a distribution that yields about 4%, and resumed distribution increases of more than 3% in both 2024 and 2025, while pursuing sales of older buildings and investment in newer properties. - It notes market pressures cited for CAP REIT's weaker unit price, including cuts to immigration targets, an increase in rental supply, and higher interest rates; the unit price fell about 24% from its July high to a December low. - The piece references recent apartment REIT privatizations, including Minto Apartment REIT agreeing to be taken private at $18 per unit (about a 32% premium to the prior market price) and a prior InterRent REIT privatization announcement backed by Singapore's sovereign wealth fund. Summary: The changes reduce small or U.S.-dollar exposures and increase the model portfolio's CAP REIT position while converting a U.S.-listed ETF holding into a Canadian-listed S&P 500 ETF. All of the above changes will be reflected in the next model portfolio update, to be published in early February.