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3 property plays for 2014: Lend Lease, Cedar Woods and Ingenia

With the Australian property market set for another good year in 2014, it’s not too late for investors to position their portfolios to benefit. The ASX offers investors a wide selection of property developers, building product suppliers and real estate investment trusts (REIT) to choose from and each can provide exposure to the sector for investors.

Here are three property plays which stand to gain in 2014 and deserve a place on investors’ watch lists.

Dependable

While Lend Lease (ASX: LLC) offers investors exposure to much more than just the domestic property cycle, the firm does have significant operations in Australia. However its diversity means exposure to numerous regions including the UK and USA. It also has exposure to numerous sectors including commercial, residential and retail; and numerous business lines including investment management, project management, construction and property management. This diversity can help deliver a more dependable stream of earnings and smooth out the ups-and-downs of any single regional property cycle.

Sweet spots

Cedar Woods Properties (ASX: CWP) would appear to be in a sweet spot with projects such as Williams Landing in Victoria benefiting from heightened demand for new homes and developments. Cedar Woods has a very sound track record of creating shareholder value and with a quality land bank and pipeline of development opportunities, the firm is poised to benefit from continued property demand in 2014.

Up and coming

Ingenia Communities (ASX: INA) has in a short space of time become a highly regarded owner, operator and developer of property assets for seniors’ housing. In 2013 the company was busy acquiring a number of assets to boost its portfolio and expectations are that acquisition activity will continue in 2014.

Ingenia’s focus on providing housing solutions for retirees and seniors puts the company in a sweet spot given Australia’s aging population demographics.

Foolish takeaway

It can be dangerous to be ‘late to the party’ when it comes to investing in cyclical stocks. For this reason investors should review the earnings of property companies over a period of years (ideally a whole cycle) to determine the through-the-cycle earnings capability of a property-exposed business.

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Motley Fool contributor Tim McArthur owns shares in Cedar Woods Properties.

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