Vision Capital’s Jeff Olin shares three high-conviction stocks he’s buying right now: Chartwell Retirement Residences (CSH.UN) – riding powerful demographic tailwinds, Dream Industrial REIT (DIR.UN) – deep value in distribution-focused industrial assets and First Capital REIT (FCR.UN) – what he calls the “highest-quality grocery-anchored portfolio in the world.”
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Chartwell Retirement Residences (CSH.UN)
- Benefits from secular tailwinds over the next 20 years due to Canada’s aging population, combined with limited new supply as operators have learned from past overbuilding and focus on strong operations like hotels.
- As the largest and most capable operator in Canada, it’s well-positioned with conservative leverage, a strong management team, and occupancy rates rising from 82% a year ago to 94% today, with potential to exceed the 95% target by end of 2025.
- Trades at a discount to NAV while U.S. peers like Ventas are at a 50-100% premium; recent acquisitions like Welltower’s purchase of AMA suggest potential for significant premium valuation. Upside to ~$22 NAV from current ~$19 price, plus a 3% dividend yield.
Dream Industrial REIT (DIR.UN)
- Focuses on industrial distribution tied to local economies rather than manufacturing, making it resilient to tariff concerns; the sector has faced headwinds but offers a cheap entry point with strong total return potential.
- Well-managed with a great joint venture through Summit (acquired by Singapore’s GIC pension plan), generating management fees and leveraging GIC’s balance sheet for growth.
- Attractive 5.6% dividend yield and trading at a discount to underlying real estate value. Upside to ~$17 NAV from current ~$12.50 price.
First Capital REIT (FCR.UN)
- Owns the highest quality grocery-anchored shopping center portfolio in the world, concentrated in six major urban Canadian centers (75% in Toronto, Montreal, Vancouver) with no fashion, power centers, or secondary markets; provides stability from grocery anchors and necessity-based tenants.
- Strong operational performance with increasing net operating income, reduced bad debt, resilient demand, and no new supply; includes 20 million sq ft of in-place space plus 22 million sq ft of incremental density for long-term value creation.
- Olin believes the business should be for sale and management is late to initiating a formal process; despite past governance concerns and Vision Capital’s activism involvement, assets are exceptional, but a structured sale (inviting buyers like Blackstone or Brookfield) could unlock value beyond the current ~$19 trading range.
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