The Globe and Mail reports in its Saturday edition that higher interest rates and lower immigration have not done any favours for Canadian Apartment Properties REIT. The Globe's John Heinzl writes that CAP REIT has been the worst performer in his model Yield Hog Dividend Growth Portfolio over the past year, posting a decline of about 23 per cent. Higher interest rates, cuts to immigration targets and an influx of new rental supply have all turned investor sentiment against the residential REIT sector, which until recently was seen as one of the most attractive real estate classes. Mr. Heinzl believes selling after such a precipitous decline would be a mistake given CAP REIT's solid fundamentals. The REIT yields about 4 per cent, its balance sheet is strong and some of the changes it is making to its portfolio should contribute to long-term growth. Many analysts say the sell-off in CAP REIT's units has been overdone. Of the 13 analysts who follow the company, nine have buy ratings, with three holds and one sell. The average price target is about $50, which implies a gain of about 28 per cent from CAP REIT's price of about $39 as of Friday morning. Mr. Heinzl says the consensus seems to be that the units are undervalued.