Andrew Moffs’ Top Picks for April 28, 2026

Andrew Moffs, Senior Vice President & Portfolio Manager, Vision Capital

Focus: Real estate stocks

Top Picks: Dream Industrial REIT, Chartwell Retirement Residences, GO Residential REIT

MARKET OUTLOOK:

Investors entered the second quarter challenged by multiple distinct risk factors that are rapidly evolving, placing uncertainty on global growth, led by, but not limited to, geopolitical conflict in the Middle East, a private credit “liquidity crunch,” and the rising risk of artificial intelligence (AI) to traditional business models.

While not immune to a cyclical downturn, listed real estate investment trusts (REITs) offer a uniquely defensive business model to combat today’s major risk factors under current economic conditions.

North American-listed REITs own primarily domestic assets insulated from global conflict zones and benefit from conservative balance sheets, offer daily trading liquidity on public exchanges, and operate physical assets with limited risk of obsolescence from AI disruption, with the notable exception of data centres as potential beneficiaries and office values impaired.

In light of reasonable stability in U.S. 10-year Treasury Bond yields, lending and transaction volumes continue to recover.

Most notably, U.S.-listed REITs are trading near the widest historic earnings multiple spread to the S&P500 index, positioning the sector as a compelling candidate to benefit from a reversion to the mean, by way of a rotation from growth to value.

Beneath the headlines, constructive real estate fundamentals continue to support the backdrop for listed REITs today, including:

1. Falling New Supply: Higher base rates and above-trend inflation have resulted in 48 per cent higher construction costs since 2020, resulting in decelerating new construction growth across nearly all property types, increasing both the replacement cost and the value of stabilized assets – it is “cheaper to buy than build.”
2. Access To Capital: Loosening lending standards from banks, combined with listed REITs’ low leverage profile and access to cost-advantaged unsecured debt is improving refinancing activity.
3. Resilient, Rising Cash Flows: Generally, constructive supply-demand fundamentals across the listed REIT landscape shifts pricing power from tenants to landlords. Through Q4 2025 earnings season, 62 per cent of U.S. REITs “beat” consensus funds from operations (“FFO”) expectations, above the historic average of 50-55 per cent.
4. M&A: The median listed REIT continues to trade at a discount to its net asset value on both sides of the border today. The private real estate market dwarfs the listed REIT market, and has a proven track record of acquiring listed REITs to close the gap to NAV, surfacing value for its unitholders. A wave of listed REIT privatizations continue to gain momentum, highlighted by Minto Apartment REIT and First Capital REIT announcing takeover bids year-to-date in 2026.

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TOP PICKS:

Dream Industrial REIT (DIR.UN TSX)

Dream Industrial REIT (“Dream Industrial” or the “REIT”) is a pure-play industrial REIT focused on small-to-mid-bay urban distribution and logistics assets, with a portfolio spanning Canada (58 per cent of investment property value) and Europe (42 per cent).

By focusing on small-to-mid-bay assets, the REIT is well-positioned in a segment facing limited new supply, as only 14 per cent of Canada’s under-construction industrial pipeline consists of warehouses smaller than 100,000 square feet, according to Coldwell Banker Richard Ellis (CBRE).

While the industrial leasing environment slowed considerably in the first half of 2025, it strengthened through late 2025 and into 2026 as tenants who had previously paused leasing due to tariff policy uncertainty resumed activity.

With national supply under construction currently at only 1.2 per cent of total inventory, the fundamental medium- and long-term outlook remains favourable due to secular drivers such as increasing e-commerce penetration, large-scale infrastructure projects, and supply chain reconfiguration.

Dream Industrial is well positioned with the sector to benefit from the positive fundamental outlook. It reports strong mark-to-market spreads, with a 10.1 per cent potential rent upside across its portfolio (16.2 per cent in Canada and 4.1 per cent in Europe). The REIT recently validated its asset values through a strategic disposition of 11 assets to a joint venture with CPP Investments for $805M at a low-to-mid-four per cent cap rate, slightly above IFRS values. This transaction provides substantial liquidity to repay debt, repurchase units, and fund accretive growth opportunities.

The REIT also complements its wholly-owned stabilized portfolio with a development and redevelopment pipeline. To this point, the REIT leased over 1.2 million square feet across its development projects in 2025, including two fully leased greenfield developments in Alberta. DIR has a about $270M short-to-medium term pipeline of 1.1 million square feet with an anticipated yield of six to eight per cent. Looking ahead, the REIT is unlocking value from its land bank by advancing a data centre pipeline with over 600 MW of potential and has expanded its solar program to a potential investment of over $190M, targeting an eight per cent plus yield. Vision considers Dream Industrial an attractive investment due to its strong, visible, lower-risk earnings growth profile, its diversified portfolio, and compelling valuation, trading at a significant discount to Vision’s net asset value (NAV).

Chartwell Retirement Residences (CSH.UN TSX)

Chartwell Retirement Residences (“Chartwell” or the “Trust”) is the largest owner of seniors housing in Canada operating more than 25,000 suites located in core markets in Ontario, Quebec, Alberta, and British Columbia.

In 2025, Chartwell exceeded its own internal occupancy growth targets, ending December 2025 with same property occupancy above 95 per cent. This represented a greater than 4.5 per cent year-over-year increase in average same-property occupancy for 2025.

For the full year 2025, Chartwell reported an 18.4 per cent increase in same-property adjusted net operating income (NOI) and a significant 40.8 per cent increase in funds from operations (FFO). This was driven by both higher rental rates and continued strong expense management.

Management’s “2028 Strategy” is targeting $2 billion in growth investments and $1 billion in non-core dispositions. Financial goals include maintaining occupancy above 95 per cent and achieving annual rental/service rate growth of over four per cent.

The 2028 Strategy will be supported by both demand growth from strong demographic trends and limited new supply growth driven by low construction starts.

The Trust’s acquisition strategy and cost-effective capital access are not fully reflected in its current stock valuation.

Compared to higher valuations in the U.S. seniors housing sector, Chartwell offers a more attractive risk adjusted return and remains a core position in the Fund.

Chartwell remains a core holding in the Fund, as Vision maintains confidence in the Trust’s outlook.

GO Residential REIT (GO.U TSX)

GO Residential REIT (“GO” or the “REIT) is an owner, operator and acquirer of luxury high-rise multi-family properties, with a unique focus in New York City. Launched through its IPO in July 2025, the REIT’s initial portfolio consists of over 2,000 suites in the Manhattan submarkets of Lenox Hill and Murray Hill, where demand has been strong and supply has been limited. According to CoStar, Q1 2026 Class A stabilized vacancy rates in these submarkets stood at 0.4 per cent and 1.6 per cent, respectively, well below 7.1 per cent for the U.S. overall.

Due to these factors, Vision believes GO has significant NOI growth potential. In the near term, the REIT has been benefiting from its mark-to-market opportunity, with average in-place monthly rents estimated to be 10 per cent below market rents, as of July 2025. As such, GO has been able to meaningfully increase revenue by increasing rents to market rates on lease renewals or unit turnovers. Additionally, over the medium term, management anticipates driving additional revenue growth through value-add capital investment through suite repositioning and reconfiguration initiatives, which Vision anticipates could generate returns of more than 20 per cent on investment.

Despite the prospect for strong NOI growth, the REIT’s units trade at a significant discount to NAV, with an implied cap rate of 6.5 per cent, approximately 100 basis points above recent private market transactions. Given the signification valuation disconnect relative to its intrinsic value and growth potential, Vision views GO’s units as an attractive investment.

PAST PICKS: MARCH 31, 2025

First Capital REIT (FCR.UN TSX)

Then: $16.49

Now: $23.42

Return: 42%

Total Return: 48%

Boardwalk REIT (BEI.UN TSX)

Then: $67.10

Now: $67.79

Return: 1%

Total Return: 3%

Sun Communities (SUI NYSE)

Then: US$128.64

Now: US$127.24

Return: -1%

Total Return: 5%

Total Return Average: 19%