Abrdn Property Income Share Discussion Threads

[skyship] 23/1/2024 07:25

The Investment Manager highly competent; but the BoD totally incompetent - viz the debt cost debacle, driven by ABRDN and the BoD - not Jason Baggaley I suspect.

[pavey ark] 22/1/2024 19:47

Yes they gave a reduced NAV and every figure given seems to be designed to play down API and show how great the deal was for shareholders....share price, dividend cover etc.....with no mention of the recent real improvements and potential gains.
I have wondered about the valuation of Hagley Rd for some time....voids greatly reduced, good tenants signed up, new long lease agreements, target price / sq ft reached.......valuation decreases !!!???

I wasn't greatly bothered either way about this deal but now not happy with the board and the way they are going about this.

[nickrl] 22/1/2024 17:48

@pavey ark i was negative API 12mths ago but they did rather well in reducing the void rate and at some locations like Hagley Rd which has been a noose around them for several years. The BoD either don't ask the right questions or they know something we don't about the future here although they already indicated NAV will be down for Q4 but then so have CREI.

[pavey ark] 22/1/2024 17:39

Just been looking at the offer here and it does look a very strange move by the board.

CREI may have a higher portfolio yield but their portfolio has a poorer risk profile.

If completed CREI could have superior units to their own at a greater discount than applied to their more risky assets.

I wonder if the API portfolio yield quoted was before or after the considerable reduction of the void rate......and after the incentives were worked through ?

Any mention of a 20% shortfall in dividend cover, while technically correct, does look like an attempt to push this deal through.
We should get a Q4 update in very early February let's see what the the cover is there or if any optimistic comments are even allowed.

Knowsley was/is a big asset and news was due ???

Much has been made of the "loading" of the RCF but the management team bought the Morrisons supermarket, built the Knowsley unit and completed the Rainhill Rd refurb (the bulk of the RCF loan).....all good yielding ,sound ,long term investments.......silly them !!??

Not necessarily opposed to a similar deal or this one on better terms but very suspicious of the board going into this deal when it looked like API was likely to show material improvement in income and overall yield.......this potential improvement is certainly not included in the offer.

[skyship] 22/1/2024 16:50

yump - totally agree with that.

The Chairman emailed a response to my earler, part of which said:

"As part of its review, the Board assessed a managed wind-down of the portfolio taking into account market conditions and the risks associated with such a process, and concluded that a merger with CREI represented a superior outcome for API shareholders."

I have no confidence whatsoever in a BoD who presided over the interest rate debacle. I have considerable confidence in Jason Baggaley (Investment Manager) who would assuredly do a good job winding down the portfolio.

We deserve a vote: Merger or Voluntary Liquidation

[yump] 22/1/2024 14:25

Well I’m sure anyone that bought at 80p would be well chuffed with taking a loss and then waiting for a slight increase in dividend in another REIT, to compensate them in xx years, even though that would depend on the long term health of your destination REIT.

What a weird investment strategy when you could just wait for interest rates to drop and for API to recover its share price.

[nickrl] 22/1/2024 13:05

@Sky not sure the inv mgrs get much say this is the same as EPIC where Callum was sold down the river. Presumably there are some costs to terminating Aberdeens inv mgt contract as wel.

[mindthestash] 22/1/2024 11:48

I'm minded to write to chairman.
I was in epic, they agreed a sale of their great little retail shed portfolio for a massive discount with no reason to sell. Idiots can't wait a couple of years?

I switched into ukcm who sensibly refused offer.

Bigger doesn't always mean better.

However there's no doubt others see opportunities with small reits and weak boards to make money.

Thanks for naming a few options.
I'll hang on a bit at api to see how it plays out. No idea what the shareholding looks like and who the big numbers belong to but expect the chair is sounding them out.

[dr biotech] 22/1/2024 11:11

I'll be voting for it. Its not really the outcome I wanted - my average here is about 59.5p, although that doesn't include dividends which are significant. But we'll get a decent management team, lower overall costs and an improved, covered dividend. I don't feel liquidation would be better outcome, that would be a longer wait and we would be known as a weak seller. Plus one of the reasons I hold here is I wanted some diversification.

If I was offered say 65p cash I'd take that over a merger, assuming a short timeline.

I think the deal makes sense for CREI too - even though their share price doesn't agree with me

[nexusltd] 22/1/2024 10:47

@Skyship. CREI/API is an agreed merger; the boards and their advisors will have considered the options. It is now down to the shareholders to decide. I'm still reviewing the comparatives as I have no prior knowledge of CREI; and then will decide how to vote my API holding.

[skyship] 22/1/2024 10:26

Emailed our excellent Investment Manager - Jason Baggaley. He is restricted from comment; so has forwarded to the Chairman - James Clifton-Brown:

----------------------------------------------------------------

Jason - seems to me that you may have been shafted by this proposed CREI merger.

Not just you however, shareholders too seem to be being sold down the river.

If API is to be sold then would it not be a far better proposition to at least
consider Voluntary Liquidation.

This would likely deliver a value of minimally 72p/share over a maximum timescale
of perhaps 2yrs, perhaps less.

A merger with CREI seems to be delivering 55p...perhaps 60p, as CREI recovers
from the panic low of 70p.

Can you confirm whether the BoD has considered such a course of action; and if
not, why not.

I would be grateful if you would forward a copy of this email to the Chairman, a
role requiring him to consider and react to shareholder views.

Thanks

[skyship] 22/1/2024 09:44

yump - is it not time that you recognised that income and capital gain are two sides of the same coin? If you get your capital back rather than nursing a 30% loss; you then reinvest in one of the other high-yielding REITs rather than staying with API on a 5.3% yield equivalent.

[yump] 22/1/2024 08:47

Which shareholders are those then ?

The ones that bought at 80p for a stream of future income, or you ?

[skyship] 22/1/2024 08:22

CLI,EBOX,SERE could all attract a bid - for the basic stats see my post on the CP+ thread yesterday.

As for the game in hand here. API shareholders would be far better served by a voluntary liquidation.

Would take less than 2yrs and likely deliver 72p+.

That would translate to a GRY of 14%pa - PLUS - possibly as much as 17%.

I think shareholders should make their views known; and seriously consider this scenario.

[riverman77] 21/1/2024 20:54

Very surprised that ASLI and EBOX not already merged - similar portfolios and both under the Abdrn umbrella. Would make sense to combine them and get the economies of scale.
I can also see someone coming in for SREI - a decent portfolio but like a lot of the sector a bit sub scale and on a persistent 30%-35% discount.

[mindthestash] 21/1/2024 16:21

Noted.
Hugethanks to Hugepants.

I'll have a lookover

[hugepants] 21/1/2024 15:41

"Any bets on who's next?"

It's got to be ASLI. It has a 100% logistics portfolio and is currently on a 36% discount to NAV.

27 Nov 2023
abrdn European Logistics Income (ASLI) has launched a strategic review into the future of the company that could result in its sale or merger with another company.

[mindthestash] 21/1/2024 12:52

Both API (which i hold) and CREI major in industrials. This is where the action is

MLI as was -Industrial reit --went for a big premium and went private

I also hold UKCM but it looks a bit large to be bitesize? having rightly refused a naff offer recently.

Any bets on who's next?

[hindsight] 21/1/2024 11:09

Pavey Ark, API is my second largest Reit holding so naturally agree with you on them

Personally hope deal goes through but main thing is there is some corporate action now appearing in the sector which bodes well

spectacc mate marcus at TR Property, comments a little on these and others like lxi/lmp in money makers weekly. Main point being they think cost savings of mergers should be bigger long term

[skyship] 20/1/2024 20:50

PA - a good summation of the position.

[pavey ark] 20/1/2024 17:25

As an investor in API I would advise those not familiar with the fund to ignore the snide comments about the management and I would also point out that the uncovered dividend gap is very likely to close considerably this year as the void rate has been reduced from 10% to under 5% and the the incentives provided are unwinding.....also plenty of positive rent revisions.

I know absolutely nothing about CREI and I am not passing judgement on this deal other than if it is that bad a deal for API Shareholders and it fails then someone else will come in.

The yield on the portfolio compare favourably with many other REITs and with the Knowsley property completed the cap ex falls to practically zero.

Good management, good portfolio, good yield , large discount , lowish LTV.....bit of a debt issue but easily manageable........OKAY I've convinced myself....I want more but if people think this deal will fail I'd be happy to hold API

If CREI price is down it must be because people think this is a bad deal for them....not from where I'm sitting !!!

So I think this offer will fail but as people have pointed out API is now for sale....perhaps API is the one to buy .....just joking ...obviously people should make up their own mind ...."you pays your money you takes your chance"

[hindsight] 19/1/2024 18:23

Yep rolled some EPIC proceeds into CREI too, sort of hedge for me but realistically think it will be like CTPT/LMP and recover post merger

[essentialinvestor] 19/1/2024 17:49

ii accepted telephone transactions on CREI, web rates applied. 27 minutes hold time for someone to answer, joy ;.

[dr biotech] 19/1/2024 17:37

Seems that API gained about £20m and CREI lost about £40m today. Seems that one of them would be incorrect. May buy some CREI as a bit of hedge.

[ammons] 19/1/2024 17:17

Holder of API already but couldn't buy CREI late this afternoon on Interactive I. Very annoying having bought and sold CREI thru them not that long ago.