European Real E Share Discussion Threads

[colonel a] 05/1/2016 12:46

I'm not that bothered either way, retaining my position is largely based on back calculation of the value of the Spanish properties from the yield, and the cash they still hold.
La Gaude is the unknown, modestly valued on the books, almost ignored in the share price

But property valuation of a property will try to take all income and cost into account.
If the dilapidation payment has been agreed prior to the previous valuation then I don't think there's any doubt that Schroders would have dropped the book value when the cash was paid.
Assuming it was not, they have a degree of discretion.
Personally I think they should have said what they did in the RNS which gave the distribution NAV.

[chevalierdaven] 05/1/2016 12:44

Time for profit taking? It may be a long road from here to further capital gains.

[profitaker] 05/1/2016 12:31

I don't think the surveyor, in valuing the building(s), will consider any payments made to it's owner. Only the building itself and strength of the covenant will be taken into account.

A small fall in property value more than offset by the gain in FX. I'm happy with that.

[colonel a] 05/1/2016 10:51

Not sure I'm so happy about their announcement.

When IBM moved out they made a €2.5m dilapidation payment.

IMO a conservative accounting policy would have reduced the valuation of the property by that amount from that point.

We don't know if they did this in calculation of the distribution NAV.
{I hope and suspect that they did but it should have been specified in the RNS.}

My calculation was that they had about £9m cash left after the distribution which with the recent favourable exchange rate movement would give a NAV a few pence short of £1.9

[flyfisher] 01/1/2016 08:12

Group bimbo have a press release page in english on their website, it will probably be announced there if and when it completes, maybe it is worth saving a link to it.

[janvrot] 31/12/2015 19:32

i have been looking at grupo bimbo. very impressive company with strong cash flows. frustrating that panrico deal is taking so long. hoping some spanish speaking investors are googling for news everyday.

[redhill9] 31/12/2015 14:31

Yes, Hargreaves Lansdown were very quick too but Barclays are always so slow....... When I've complained in the past they just refer me to their T&C's which allow them something like 7 working days to process cash activities.

[colonel a] 31/12/2015 13:49

Ditto Barclays.
Have already complained and will do further.
Very poor from them.

[rj allen] 31/12/2015 12:18

TD Waterhouse cash received 23/12/15

[redhill9] 31/12/2015 11:13

Still nothing from Barclays - I assume no-one else has received their cash in a Barclays account yet?

[redhill9] 23/12/2015 22:51

Clearly neither of your accounts are with Barclays........

[redhill9] 23/12/2015 22:51

Clearly neither of your accounts are with Barclays........

[flyfisher] 23/12/2015 21:12

Redemption cash received in both of my accounts.

[redhill9] 07/12/2015 17:03

Colonel A, apologies. I had the date of 18 December in my mind for another reason and typed it here without realising the error - it should have read 31 December as you suggest.

Quote from the IMS The portfolio will next be valued on 31 December 2015.

[colonel a] 07/12/2015 16:06

Redhill9,
Where do you get the NAV update due on Dec 18th.
I would have expected an update in early Jan {year end NAV} as per previous years.
Sorry if I'm missing something obvious.

[redhill9] 07/12/2015 15:35

janvrot, The latest on Spain from ERET is I think the following from the IMS:

With regards to the three Spanish assets, we plan to commence marketing once the covenant strength of the tenant, Panrico, improves. We consider it a positive development that Grupo Bimbo (a Mexico based multi-national baking company) has made a conditional offer for Panrico. Should this transaction complete it would be likely to have a positive impact on our tenants covenant and improve liquidity of the Company’s properties in the investment market. We are closely monitoring the situation.

When Bimbo announced the proposed deal for Panrico in July they said in their press release:

The transaction is conditional upon receipt of customary regulatory approvals and is expected to close during the fourth quarter of 2015.

I can't find anything more recent about the transaction. ERET are due to update their NAV on 18 December so it would be nice if Bimbo completed before then......

[janvrot] 07/12/2015 14:17

Next news should be on Spain. Anybody have an update on the Bimbos transaction? I vaguely recall that more news was expected in December.

[colonel a] 07/12/2015 12:20

£ still stubbornly high and looks as if they bought even higher, but will be very nice to get cash back.
Interesting to see which brokers get the cash out before Xmas.

[redhill9] 07/12/2015 09:53

Return of 65p per share and NAV of 180p. No mention of revaluing for Panrico so presumably that's still to come.




Extract:
Further to the approval by the Company's shareholders of the winding down proposals (as described in the Circular to shareholders on 12 July 2011) the Company today announces that it will return approximately GBP18 million (equivalent to 65 pence per share) on 21 December 2015 (the "Redemption Date") by way of a compulsory partial redemption of shares (the "Fifth Redemption").

The Fifth Redemption will be effected at the estimated unaudited Redemption Net Asset Value per share as at 4 December 2015 of 180 pence per share. The estimated unaudited NAV has factored in the receipt of the sale proceeds of the Kaiserslautern property at a 12% premium to its June 2015 valuation, the EUR2.5 million dilapidations received from the tenant at the La Gaude property and the change in the currency exchange rate since the 30 June 2015. The Redemption will be effected pro rata to holdings of shares on the register at the close of business on the Redemption Record Date, being 21 December 2015. On this basis 36.4 per cent. of the Company's issued share capital would be redeemed on the Redemption Date.

[colonel a] 03/12/2015 17:47

Hope they didn't buy £ yesterday.

[flyfisher] 03/12/2015 10:53

Interesting thought jonwig, I would imagine that the Spanish assets, with an investment grade tenant, long lease and high yield would be a good fit. However I would not expect a new reit to be wanting the French property as it is unlet and is more of a development asset.

[jonwig] 03/12/2015 10:08

I hope someting like this is being considered. Tony Smedley is the lead investor for both ERET and the new offering:



the other poihnt about a share exchange would be that mainstream property ITs are trading at a premium to NAV, so the present discount could be magicked away.

[redhill9] 03/12/2015 10:00

Imaginative thinking, jonwig.

Personally my only concern with ERET is how long the Nice property is going to take to either be sold "as-is" or re-developed for sale. Hopefully the Spanish property will be revalued upwards shortly and any subsequent package deal that sold the residual assets at a modest discount to current book value would be very welcome.

[jonwig] 03/12/2015 09:25

I'm a bit out of touch with this company, though I still have a few shares.

I wonder what people think of the forthcoming IPO of Schroder European REIT:



It occurs to me that they will need to establish a seed portfolio, and ERET's legacy assets might serve that function. There would, of course, be potential for a huge conflict of interest and ERET's shareholders would need to vote on it.

The advantages would be a lowering of charges across the Schroder property teams, inside knowledge of the assets involved and getting ERET off its books. These might offset a less advantageous price for the assets. ERET shareholders might be offered shares in the new company as an alternative. (They might be more liquid than ours!)