The Local Shopping Reit Share Discussion Threads

[valuschmalu] 20/5/2016 21:07

stathroyal-thanks for that. Impressive detective work!

On a linked note can someone explain how the unrealised loss on properties was £400k in the P&L when on a like for like basis it was only £100k in the comments. I know its only a £300k difference but its annoying. I recall something similar at the finals last years with realised losses.

[strathroyal] 20/5/2016 17:51

spooky - Yes please. You might also explain why two-thirds of the other properties found buyers who presumably weren't concerned about the forthcoming vote.

[skyship] 20/5/2016 17:34

Confirmed - it did say £200k earlier!!!!!

I took a look at the stats info & thought it all rather bizarre...

[spooky] 20/5/2016 16:35

I was thinking of telephoning them to see if they would flip it for a quick £50,000 profit :-o)

[epistrophy] 20/5/2016 15:35

Ha looks like they've just fixed it. The price definitely said £200k this morning, which seemed a bit unlikely!

[spob] 20/5/2016 15:14

1307 X

Try again Epis :)

[spooky] 20/5/2016 13:51

strathroyal - Do you really need me to explain to you why the EU Referendum will have a short term impact on the decision making process of a potential buyer of a bunch of secondary retail properties?

[epistrophy] 20/5/2016 12:06

Off topic and probably a daft question, but can anyone explain why a prime Birmingham office building would have sold for a 50%+ yield in that auction?

[gfrae] 20/5/2016 11:39

"Viable" is presumably subjective,but I presume they wish to keep enough properties to pay the fixed admin costs plus listing costs etc and I assume pay a dividend.
Looks like we will have to live with a 10% odd yield for now.

[skyship] 20/5/2016 11:03

Bulwell (Nottingham) - I would have thought any potential buyer there would wait for the Remain vote to endorse the buy.

I suspect this will be back on the Market once they've found a tenant for the vacant office unit - which will be post Referendum.

[strathroyal] 20/5/2016 09:28

spooky - can't see why Brexit would affect this stock, the problem is the quality of a number of the outlets. The Bulwell offering is 5 units (beauty shop, leathergoods, coffee shop, pet shop anda vacant office unit), asking price was £290k for a £33,250 income, well over a 10% yield yet no interest. This won't change in 4 weeks time however we vote.

I recently bought GRI, another property share. They had a decent set of results earlier this week and the stock has risen slightly, as you would expect. No Brexit tremors there either.

[my retirement fund] 20/5/2016 08:31

What in 2026 or 2036?

[spooky] 20/5/2016 07:54

If we vote to stay in, i will be surprised if they don't achieve NAV.

[strathroyal] 19/5/2016 23:00

val- bit of detection. LSR website has a gallery showing the majority of their properties and I compared a few of these to the Acuitus auction. Two, Bulwell and Ipswich were obviously the same properties and both had Evershed as the solicitor. I then looked at Allsop's auction site for properties where Evershed were again acting as solicitors, and at least two in Chelmsford were evidently LSR properties.

Unfortunately, the property at Bulwell didn't sell on the day so I would suggest that this market is indeed tough and despite a number of negative comments, Internos are probably doing a decent job. I doubt that NAV will be achieved at the end of the day and I certainly wouldn't consider topping up.

[valuschmalu] 19/5/2016 20:29

strathroyal-how do you know which properties in auction belong to LSR?

[maiken] 19/5/2016 17:20

LSR have emailed me saying they will not comment on sales since Mar 31st or offer any guidance on when portfolio becomes unviable.

[cockerhoop] 19/5/2016 09:40

Cheers, makes sense regards the RNS - I also had a trading update from NWT after hours last night which was dated today!

[maiken] 19/5/2016 09:36

I've just rung Internos to ask for guidance on when portfolio becomes unviable size-wise versus mgmt costs and how sales have gone since end of interim period.
They're coming back to me and I'll pass on anything here.
They did mention they'll be attempting to speed up sale of anything with no debt attached,which the interims say represent £5m of portfolio value..
By the way,they also said the 6.30pm time of reporting figs was a mistake.Someone with fat fingers pressed the 'send' button to LSE a couple of minutes too early.The intention was for them to report at 7.00am today with everyone else !

[cockerhoop] 19/5/2016 09:22

Weren't swaps were bought out for £1.76m in January, Tiltonboy?

[tiltonboy] 19/5/2016 08:50

Given the near 10% underlying yields, I see little downside risk to capital, but do not wish to see rental income swallowed up in management charges.

Let's see what happens post the vote.

I would be surprised if some entrepreneurial group wasn't having a close look.

[skyship] 19/5/2016 08:22

Could well be that the latent buyer is waiting for the Referendum - a Remain vote might then trigger an offer. If it doesn't, then the new Internos manager Rupert Wallman may decide to step on the gas with more small sales.

Minimum portfolio size? No idea on that score - but substantially lower than where we are now surely...

[cockerhoop] 19/5/2016 07:59

As they have been in negotiation for the sale of the majority of the remaining properties for the last 6 months, that block of properties would not have been marketed. Perhaps now they can sell a few more.

Any idea's on the minimum portfolio size that would be viable without a bulk sale?

[maiken] 19/5/2016 07:49

what are the reasons which prevent LSR putting more properties into auction ? recent Allsops auctions seem to have had success rates of 85-90%.Last auction had 214 lots.Surely LSR could put up,say,20 properties without flooding the market?I'd appreciate any perspectives

[skyship] 19/5/2016 07:24

Not as displeased as others. There appears to be progress, slow, yes – but not necessarily their fault. There seems to be a buyer out there; just at a lower level than anything which would trigger an INTERNOS bonus! I agree with Tiltonboy – 35p would be acceptable.
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Net Asset Value ("NAV")
During the period NAV rose by 1.21% to GBP35.3 million or GBP0.43 per share, based on 82.5 million shares in issue, excluding those held in Treasury (30 September 2015: GBP34.9 million, GBP0.42 per share).
The Group held GBP12.29 million of cash at the end of the period.
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Outlook
Whilst the uncertainty over the UK's future relationship with the European Union appears to have dampened property investment activity, we do not believe that it is likely to have a material effect on our occupier base. We expect our occupier businesses to perform robustly and our portfolio to continue to be income-generative. With the removal of the interest rate hedging agreements and extent of our cash reserves the Directors believe that the Company's financial position is likely to be increasingly healthy.

During the last six months we have been in detailed negotiations with a party for the sale of the majority of the Company's remaining property assets. However, these discussions have not led to a transaction. Our overall aim remains to execute the investment strategy adopted by shareholders in July 2013, in pursuit of which we have now sold GBP93.9m of property. Whilst we remain open to large portfolio transactions, we will focus on our programme of individual property sales, particularly of uncharged assets, in order to further reduce the LTV ratio of the bank facility and the Company's overall gearing. This will enhance cover over the banking covenants and unlock lower amortisation and interest margins. However, in the absence of a sale of the bulk of the properties sufficient to enable us to speedily dispose of the remainder at sensible prices, we will not continue the individual property sales programme below the level at which running the portfolio becomes unviable.

The Directors will continue to keep the dividend policy under review and will consider reinstating distributions when this is justified by the Company's overall financial position and the prospects for ongoing income generation. The current recurring income (adjusted for an estimate of the reduced cost of debt and property sales during the period) implies a recurring EPS of 2.6 pps and an EPS yield of 9% on the closing mid-market price of 29.29p on day prior to this report. However, future recurring income may be affected by factors such as further asset sales and changes in the Company's cost of debt.
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