Real Estate Credit Inves... Share Discussion Threads

[my retirement fund] 04/12/2015 12:23

I suspect this is headed to a slight discount to NAV on the back of limited EU QE.

May be tempted at £1.60

[kenny] 04/12/2015 12:17

RECI was recommended as a buy in an article online yesterday in Investor's Chronicle entitled "Five high-yield small-caps".

[davebowler] 27/11/2015 10:25

Liberum;
RECI's NAV at 30 September 2015 was 162.5p which represents a NAV total return over the prior six months and 12 months of 3.5% and 9.0% respectively.

RECI's allocation to loans rose 24% to £108m at September 2015 (March 2015: £87m) in the half year period. Four new loans were completed with commitments of £16m. Post-period end, RECI has restructured two of the existing loans resulting in a £12m increase in net commitments.

The weighted average LTV and interest rate on the portfolio is 73% and 13% respectively. The weighted average life of the loans is relatively short at 2.1 years and the manager expects cash inflows of £13m from loan repayments in the coming months.

The return from the bond portfolio in the half year was 3%. The bond portfolio has been impacted by mark-to-market volatility as a result of a pull back in capital inflows to the core European real estate markets. Importantly, the performance of the underlying assets remains robust and the portfolio is also supported by amortisation and high coupon receipts.

Separately, RECI has announced an unchanged dividend of 2.7p for the quarter to September 2015 (6.3% prospective dividend yield).

Liberum view
RECI's higher loan allocation has proved beneficial in recent months given the volatility and yield widening experienced in the bond market. The pull back in the bond market should offer scope for investment in new issues at more attractive yields.

RECI's NAV total return of 9% over the past year is the highest of the peer group. We believe RECI remains well positioned in the current market to deliver superior NAV growth given its ability to source attractive whole and mezzanine loan opportunities. RECI currently trades on a 4.3% premium to NAV (in line with the peer group) and offers the highest dividend yield in the sector at 6.3% (peer group average of 5.7%).

[davebowler] 04/11/2015 10:03

Liberum;
Specialist Finance

Real Estate Credit Investments (BUY)
0.8% NAV uplift in October

Event
RECI's NAV grew by 0.8% in October 2015 to 163.3p per share (30 September: 162.0p) mainly due to interest income from the loan portfolio.

RECI increased loan commitments by a total of £11.4m in the month. This included its commitment to a whole loan secured against German multi-family properties which has risen by an additional €8.3m (of which €5.3m was drawn in October) and a shareholder loan secured against UK logistics assets which increased by £5.5m (of which £1.7m was drawn in the month).

The mark-to-market movement on the bond portfolio in the month was -0.1%.

Liberum view
October was a positive month for RECI with the portfolio generating returns broadly in line with expectations (0.8% NAV return - 9.6% annualised). RECI is currently trading on a 5.3% premium to NAV which is at the upper end of the peer group range (2.5% - 5.6%) which we believe is justified by RECI's superior NAV return prospects in comparison to peers.

[davebowler] 19/10/2015 09:46

Liberum;
Event
RECI has announced a change to its senior portfolio management team following Graham Emmet's decision to leave Cheyne Capital (the investment manager of RECI). Ravi Stickney (Head of Cheyne's real estate business) will take responsibility for RECI. Cheyne's real estate team comprises 13 professionals with AUM of c.$2.2bn.

Liberum view
Graham Emmett has been a portfolio manager for RECI since he joined Cheyne Capital approximately two years ago. We believe the uncertainty associated with a change in personnel is minimised as Cheyne's real estate credit team is well placed to handle a smooth transition given its strength and experience. Ravi Stickney has been with Cheyne Capital since 2008 and is the head of the investment manager's real estate debt business and will take over the portfolio management of RECI.

Private Equity

[davebowler] 06/10/2015 10:34

Liberum;
Real Estate Debt

Real Estate Credit Investments (BUY)
0.4% NAV uplift in September

Event
RECI's NAV grew 0.4% in September 2015 to 162.0p per share (August 2015: 161.5p). The NAV return in the month was driven by interest income from the loan portfolio (13% weighted average yield) which was partially offset by a mark-to-market loss of -0.78% from bonds.

In terms of transactional activity, £4.3m of bonds were sold to fund future loan drawdowns. The bonds were sold at an average price of 0.95 compared to an acquisition price of 0.63 (realised 51% uplift).

Liberum view
We calculate a NAV total return of 8.9% over the year to 30 September 2015 for RECI. This compares to 7.7% for SWEF (12 months to 31 August 2015), 7.3% for LBOW (12 months to 31 July 2015) and 0% for TFIF. We believe RECI remains well positioned in the current market to deliver superior NAV growth given its ability to source attractive whole and mezzanine loan opportunities. RECI currently trades on a 2.5% premium to NAV (compared to an average of 6.0% for peers) and offers the highest dividend yield in the sector at 6.5%.

[holts] 24/9/2015 15:57

running back to NAV

[my retirement fund] 16/9/2015 07:14

I'd like to get back in here but I am worried about the premium to the NAV, the risk of the NAV falling and the ability to maintain dividend growth.

[spittingbarrel] 15/9/2015 16:14

Just bought back in, worth having just for the dividend.

[davebowler] 04/9/2015 10:00

Liberum;
Real Estate Credit Investments (BUY)
0.5% NAV growth in August

Event
RECI's NAV per share as at 31 August 2015 was 161.5p including a dividend of 2.7p that went ex on August 27, representing a 0.5% increase in the month (excluding dividend). The Company completed a €9.7 million senior loan investment, funding the purchase of a shopping center located in a residential suburb of Berlin. During August, RECI received a repayment of €12.5 million, out of a committed drawn exposure of €28.0 million, on an existing whole loan secured against German multi-family properties.

In July 2015 and following the sell down of a senior portion of a construction whole loan written in July 2015, RECI received a repayment of £1.7 million from a committed drawn exposure of £5.8 million. The residual investment is now a mezzanine loan secured by way of second charge on a pre-sold residential development in East London, yielding in excess of 12%.

Liberum view
RECI trades on an 8.8% premium to the last reported NAV compared to an average of 5.6% for peers. RECI's dividend yield of 6.1% also compares favourably to the peer group average of 5.7%. We believe this is justified as RECI offers the most attractive return prospects of the real estate debt funds.

[skinny] 11/8/2015 16:39

Real Estate Credit Investments PCC Limited announces today that it declares an ordinary dividend for the Core for the period 1 April 2015 to 30 June 2015, of 2.7 pence per share (a total amount of GBP 1,966,099). The dividend is to be paid on 18 September 2015 to ordinary shareholders on the register at the close of business on 28 August 2015. The ex dividend date is 27 August 2015.

[davebowler] 07/7/2015 10:47

Liberum;
Real Estate Credit Investments (BUY)
6.2% NAV return in H1 2015

Event
RECI's NAV at 30 June 2015 was 161.9p per share, representing a NAV total return of 0.6% in the month. The NAV total return in H1 2015 (June period end) is 6.2%.

A new €1.9m loan was made to a JV company, which is owned by Cheyne-managed funds and a Dublin-based asset manager, to acquire a large city centre retail asset. The total RECI commitment to this two year loan is €2.1m out of a total investment of €10m by Cheyne funds.

A £1.6m repayment was received reducing a drawn loan commitment of £6.1m, secured on a portfolio of UK logistics and industrial properties. The loan repayment was due to new senior debt financing.

Liberum view
RECI's NAV total return in H1 2015 (+6.2%) is on track to meet the projected total return expectations of 11-12% pa.

We believe the city centre retail asset that was acquired was Clerys department store on O'Connell St in Dublin as press reports indicate it has been acquired by a joint venture between Cheyne Capital and D2 Private. A five year €24m restoration programme of the property was completed in 2004.

RECI trades on a 7.8% premium to NAV (6.2% dividend yield) which is slightly ahead of peers (5.7% average premium to NAV) and we believe this is justified as RECI offers the most attractive return prospects of the real estate debt funds.

[deadly] 24/6/2015 15:28

Goes XD for 2.7p tonight so let's see if it drops.

[davebowler] 23/6/2015 15:50

After holding for several years I've sold a few on the same assumption, but I do realise that the NAV is a bit understated due to the Bond Portfolio being below par.

[spittingbarrel] 22/6/2015 11:06

Looks like they've got a bit of ahead of themselves here, so I'm out. Not sure who would be buying so far above NAV.

[skinny] 16/6/2015 16:46

Notification is made in accordance with LR 9.6.14(2) that Mark Burton, a director of the Company has advised the Company that he has been appointed as a director and chairman of AEW UK REIT plc, whose shares were admitted to trading on the Main Market of the London Stock Exchange plc on 12 May 2015.

[skinny] 11/6/2015 08:20

Ordinary Dividend for RECI LN (the Core shares)

Real Estate Credit Investments PCC Limited announces today that it declares an ordinary dividend for the Core for the period 1 January 2015 to 31 March 2015, of 2.7 pence per share (a total amount of GBP 1,966,099). The dividend is to be paid on 24 July 2015 to ordinary shareholders on the register at the close of business on 26 June 2015. The ex dividend date is 25 June 2015.

[skinny] 11/6/2015 08:19

RECI1 records net profit of £13.8 million and total return of 12.3% over the year

· Taking dividends into account, the NAV total return per share was 12.3% in the year ended 31 March 2015
· Net profit of £13.8 million includes £5.8 million of fair value gains
· The Company's commercial and residential loan portfolio grew to £90 million drawn (£102 million committed) as at 31 March 2015, which is a 76% increase from the £51 million of drawn loans as at 31 March 2014. This reflects the continuing attractive opportunities RECI is seeing in the loan markets
· Suitable loans originated by Cheyne Capital Management (UK) LLP (the "Manager") continue to feed the investment pipeline; RECI has completed a further loan drawing post year end, and is in documentation on two further investments
· The directors of RECI are pleased to declare a dividend of 2.7p per share in respect of RECI Ordinary Shares for the quarter ended 31 March 2015

more...

[cerrito] 07/6/2015 12:39

By my calculations the end May NAV was at a record high

[davebowler] 04/6/2015 10:53

Liberum;
Real Estate Credit Investments (BUY)
Positive growth continues

Event
RECI's NAV rose 0.5% in May-15 to 163.6p per share (Apr-15: 162.8p) mainly due to interest income from the loan and bonds portfolio.

As disclosed last month, RECI has committed to a £10.2m whole loan secured on a 100% presold residential development in East London, of which £5.8m was drawn in the month. The undrawn senior portion is expected to be sold down which will reduce the company’s exposure and increase the projected IRR to 15%+ pa. In addition, a committed development loan was increased by £2.2m to £6.6m.

£3.7m of bonds were sold in the month to fund the new loan investments with an average sale price of 0.94 (59% above the average purchase price). The mark-to-market movement in the bond portfolio in the month was 0.44% continuing the strong run for 2015 YTD of +6.5%.

Liberum view
RECI’s NAV total return for the first five months of 2015 is +5.6%. The new residential development loan illustrate the manager's ability to structure deals on attractive terms. RECI is our top pick in the asset-backed debt space on the basis of the manager's track record, ability to source deals and the company's NAV growth prospects. RECI's shares currently trade on a premium to NAV of 3.9% (vs an average for the peer group of 6.3%).