|Italian vote could be really important: if it goes against the EU will have to consider major changes to survive. It could be those changes allow the UK to stay in the new EU, it could be that the EU flounders (and would that mean London becomes even more attractive?). I can see ways it could be very positive for KWE, though the Euro looks overvalued as it is, and so our ex-UK property could suffer a drop in sterling value.
But agree, where else can you buy 5% yield at a 20% discount? (well, NBPE perhaps...)|
|Yes buyback done for time being. Not sure the Italian vote will have that much effect on KWE, but plenty of uncertainty elsewhere.
KWE a value/discount/divi holding for me.|
|Well, is that the 100m spent? I was doing some rough calculations and I think they would have made at least 20m from buying shares and cancelling them, so it should increase the NAV by something like 18p per share. It's all guesswork really until we have visibility on property values, but for now the attraction is surely the 5% yield, though if the Italians lose the referendum that could cause severe uncertainty.|
|XD today I believe? But fair point - although my hope is that with £100m gone from the market, the share will ultimately find a new level higher. Remember that if it goes up too much, they buy fewer/don't buy at all, so aren't "chasing" it in that regard. (You can, of course, make that same argument on the way down if they aren't there, so I take your point).|
|Bizarre that the share price isn't rising despite the chunky buys every day. Makes me wonder what will happen when they stop...|
|According to Spanish press reports KWE is already negotiating to sell on their Puerta del Sol property
|Odd that they didn't bounce with the other REITS yesterday - market seems to have it both ways with KWE, & both ways are negative.
Also happy to sit on them for the divi.|
|Results as expected. I'm happy to pick up the 48p dividend and wait to see what happens with commercial property. Maybe when we have inflation at 3-4% next year and bank rates at close to zero things will be clearer.|
|"The team has delivered strong operational performance in the Period across our leasing activities, where we continue to beat valuers' ERVs, and on disposals where we are selling ahead of business plan and previous book values. Our diversified portfolio remains well let [95%] delivering robust cash flows with good lease lengths and plenty of value enhancing asset management opportunities. "|
|KW also pay most of their fees in shares. They have lots of skin in the game|
|They have bought back 3.4 million shares, or 2.5% of pre-buyback float. This is an amount not to be sneezed at. Prorata we can expect the full hundred million to cancel approximately 7-7.5% of the shares. This should provide scope for income distributions for remaining shareholders to increment.
Next update is in a week, Friday 4th Nov.|
|Gearing & TER two things I've not yet bottomed on KWE (1% ongoing charge but TER considerably higher). Thought about flogging a few today, with REITs all weak ex KWE thanks to buyback. But recalled they've significantly upped the divi, ie plan to pay out 48p this yr, a yield on current share price of c.4.7%. "Others weak" isn't a good enough reason to give up that sort of yield.
HL reckon ongoing charge 2.91%, yield 4%, gearing 213%, none of which tally with the below, but I'd like to know why they're wrong.
From last Half year:
"Kennedy Wilson posted its half-year results for the six months to 30 June on Friday, with a 5.1% increase in adjusted NAV per share to 1,233.8p.
The FTSE 250 firm also reported a 60% increase in dividends paid of 24.0p per share, for a total of £32.6m of dividends paid in the period.
It declared a quarterly dividend of 12p per share, up from 10p.
Net operating income rose to £78.7m, from £58.4m a year ago, although net profit after tax almost halved to £78.7m from £149.3m.
Adjusted earnings improved to £36.2m from £31.0m, leading to a rise in adjusted earnings per share to 26.8p, from 23p.
During the half, the board said it raised a further €150m to its 2025 euro bonds, increasing the issue to a benchmark size of €550m on a ten-year term, meaning 89% ofits euro balance sheet is now hedged.
Kennedy Wilson claimed a low weighted average cost of debt of 2.9%, with 88% of debt fixed or hedged, and a long debt term of 6.0 years with a loan-to-value ratio of 41.8% within the target range.
"These strong half-year results demonstrate the team's ongoing ability to deliver robust underlying profits from a secure and diverse £3.1bn portfolio," said board chairman Charlotte Valeur.
"As such, the board is pleased to announce a further 12.0p per share dividend to be paid in Q3-16, on track to deliver 48.0p per share annualised target for 2016, a 37% increase over 2015, and reflecting an attractive dividend yield of 4.9%.
"Following the result of the EU referendum, the board takes comfort in the strong financial position of the business with significant cash liquidity and low levels of capital commitments supported by robust operating metrics," Valeur explained."|
|Good spot, thanks. Solid tenant, single break, 14yrs.|
|Early letting success for Kennedy Wilson Europe in Frimley gives boost to M3 office market - HTTP://www.commercialnewsmedia.com/archives/54103
Kennedy Wilson Europe Real Estate Plc (LSE: KWE) has let the 16,468 sq ft ground floor offices at Theta House, Lyon Way in Frimley to Surrey and Borders Partnership NHS Foundation Trust in a boost for the M3 office market.
The offices are undergoing a major refurbishment with completion due in the next few weeks.
The NHS trust has agreed a 14 year lease with a tenant break option in year seven at £22 per sq ft, joining Amer Sports which occupies the first floor. Following this letting to the NHS trust, Theta is now 66% occupied, with only the 16,700 sq ft refurbished second floor offices available to let at a quoting rent of £23.50 per sq ft.
Giles York, asset manager at Kennedy Wilson Europe, commented: “We acquired Theta having recognised a number of opportunities to drive value and the letting of void space, as well as the strong fundamentals offered by the Frimley area. Since acquisition we have undertaken a significant asset management programme resulting in the swift letting to the Surrey and Borders Partnership NHS Foundation Trust, and successfully driving up headline rents. There is interest from a number of occupiers in the remaining space”|
|Buyback showing no let-up, glad to see they're not doing things by halves.|
|Approx 2/3rds UK, more than I thought. Will still have derived benefit from the weak £ on the other 1/3rd.|
|This chart clearly shows the sector underperformance since 1st September:
free stock charts from uk.advfn.com|
|Hard Brexit fears won't be helping the REITs.
I forget KWE's exact split but they've a fair bit outside the UK, mainly Dublin but also Spain/Italy. Currency weakness will be helping. Surprised the buyback hasn't had more effect tho.|
|UK property sector very weak recently - down c10% over the past 5weeks:
free stock charts from uk.advfn.com|
|Fair point - Dublin very tight.
Mind you - London's hardly great, notwithstanding that they're all there already.|
|Specto - Amsterdam is also seen as a contender. The trouble with all these cities is that to an extent they are already full.
MF - I am keenly aware that right now the UK operation I work in is getting substantially cheaper than those in the other developed countries we have locations. This is good for job security, and quite probably pay. Mercantilism is a yay for exporters of goods and services whilst domestic overheads such as government employees remain anchored.|
|@hpcg - fair point re buyback. Not sure why they left starting it until the week after announcing.
@mf - my thought is that if people want to move from London to still have access to the Single Market, they're much more likely to go to the convivial & English-speaking Dublin than to "can't fire anyone even if you wanted to" Paris or "Frankfurt? Are you serious?".|
|Hold it for years, the divi of 12p per quarter is well covered and I'm happy to reinvest it at a significant discount to par. The big question for me is what the big European banks do: London is getting cheaper by the day and has a pool of expertise that you can't get in Paris or Frankfurt. When margins are stretched anyway, that is a huge consideration. Enough to trump Brexit fears? Who knows, but this looks a pocket of value at a 20% discount to NAV at least IMO.|
|I suspect an overseas seller. Main thing now is for the buy back to pay the least it can to the eager sellers(s).|