Aew Uk Reit Share Discussion Threads

[stemis] 19/11/2020 10:20

It depends how quickly they reinvest the cash they have available. They've already invested £5.4m of it, plus bought back £0.26m of shares on a 10.8% yield. I'm guessing it won't be too long before we see further investment.

[nickrl] 19/11/2020 09:41

SteMiS for sure others ran uncovered dividends for years relying upon valuation increases but not such a certainty for next few years I would suggest but imv they will bankroll for another couple of payouts and then see how the land lies. Even reducing it so its covered still leaves them on best yield.

[stemis] 19/11/2020 09:06

I don't see them cutting the dividend. It's cost in H1 was £6.35m. H1 profit (before valuation gains/losses) was £5.38m. So they were short by £0.97m or £1.94m a year. To cover that they've got £13.3m cash and £20.5m headroom on its debt facility = £33.8m. Should be possible to reinvest and cover the dividend. On an average yield of 7.5% it would take £26m.

[nickrl] 18/11/2020 21:06

AEWU showing the impact of selling there best income asset at Corby with NRI down to a level below that which covers the cash dividend. OK they've benefited from selling Corby at a good profit so perhaps they will use that surplus to cover the deficit. Mind you they must have one of the lowest interest rates at 1.47%.

Would need to cut it by 15% to cover it but would still provide sector topping 8.5% on todays share price should they decide to do that.

[lord gnome] 10/11/2020 14:17

Yes, for my sins I also hold TW.

[skinny] 10/11/2020 12:30

Just to clarify the TW deal was Mowden's.

[lord gnome] 10/11/2020 11:41

Thanks Skinny. I didn't know about the Taylor Wimpey deal.

[skinny] 10/11/2020 10:25

Lord Gnome - possibly to fund ?

On the 4th, they sold a development for £17m in Wantage to Taylor Wimpey.

[glaws2] 10/11/2020 10:19

But miles from the sea :)

[corbeta] 10/11/2020 10:17

Not far from the beach.

[chucko1] 10/11/2020 07:55

There are parts of it that look OK - the grass, for instance.

[ramellous] 10/11/2020 07:50

Where there’s muck there’s brass as the old saying goes lol

[lord gnome] 10/11/2020 07:45

If this is it, it looks a right dump. I think it might be termed 'ripe for redevelopment'. Cheap enough at the price, but a lot of work to be done. Certainly potential for development profits in the longer term. So why have St Modwen sold it?

[chucko1] 10/11/2020 07:43

Just as you would expect. And good timing too.

[skinny] 10/11/2020 07:05

.

AEW UK REIT plc (LSE: AEWU) (the "Company") is pleased to announce that it
has acquired the multi-let Westlands Distribution Park in Weston Super Mare
for a purchase price of GBP5.4m.

The purchase price reflects a low capital value of GBP175,000 per acre which
provides strong potential for future capital value growth based upon nearby
comparable land transactions which range between GBP350,000 and GBP500,000 per
acre for other commercial and residential uses.

The estate provides a net initial yield of 6.4% which is expected to
increase to at least 7.4% within the medium term. The average passing rent
of GBP1.50 per sq ft also provides strong potential for rental growth.

The established 323,437 sq ft estate is let to 15 tenants including North
Somerset District Council who make up 30% of the income stream. It is
located 3 miles from the M5 Motorway and 20 miles south of Bristol city
centre.

Alex Short and Laura Elkin, Portfolio Managers, AEW UK REIT, commented:
"Following the very profitable sale of our largest asset in Corby during
May, we have undertaken cautious analysis of the investment market and our
pipeline in the intervening months when looking to replace Corby and its
income stream within the portfolio. This latest acquisition is an excellent
fit for the portfolio as it offers significant potential for future value
accretion in addition to its very low level of passing rent which provides
strong prospects for future rental growth"

Following completion of the above purchase, the Company holds cash of c
GBP9.24 million.

[badtime] 29/10/2020 16:51

Ex div today

[nickrl] 22/10/2020 21:11

The comment

"In determining future dividend payments, regard will be had to the circumstances prevailing at the relevant time, as well as the Company's requirement, as a UK REIT, to distribute at least 90% of its distributable income annually, which will remain a key consideration"

is this a warning we may not see 2p again. Some positive asset mgt activity but broadly neutral on rental income with future sales.

In another warning for the sector can be seen in Costa Coffee rent for a site in Nottingham being reduced from 110k to 52k as well as 9mths free reinforces why discount remains so high on retail centric propcos.

[jombaston] 22/10/2020 18:26

I agree with above - maintain div, buyback stock, re-invest Geddington proceeds and opportunistic investment management initiatives will eventually see a recovery. Debt is low so there is wiggle room should conditions worsen temporarily

[skyship] 22/10/2020 08:47

Certainly the mood music seems to endorse the maintain view

[stemis] 22/10/2020 08:43

A big chunk of the drop in the earnings will be from the sale of Geddington Road in the previous quarter. Net income of £300,000 for a quarter is around 0.2p. That money of course remains ready to be re-invested.

[hugepants] 22/10/2020 08:39

fyi if they did reduce the divi to match last quarters "epra" earnings of 1.6p the yield would still be 8.6%

[deanowls] 22/10/2020 08:37

Is there a better deal than buying their own stock at the discount and avoiding the divi payout.

[lord gnome] 22/10/2020 08:26

The uncovered element of the dividend means that if they maintain it at 8p it will cost approx £2.5 millions pa out of capital. Not ideal, but as long as they believe that they can see a way back to normality and full cover, they will maintain it. Not a lot in the grand scheme of things and they do have plenty of cash at present with income accretive purchases lined up. I am confident that the dividend will be maintained (ceteris paribus).

[spectoacc] 22/10/2020 07:47

Cash/NAV/LTV, buybacks, acquisitions, rent catch-up - I think they'll maintain at 2p/qtr.

If Covid/Brexit get worse, always the option to cut it - but only temporarily uncovered atm.

[skyship] 22/10/2020 07:41

AEWU NAV Q3 update - down just 0.7% from 93.37p to 92.73p.

Dividend again at 2.0p, but EPS at just 1.6p.

Dividend unsustainable surely.