Aew Uk Reit Share Discussion Threads

[skinny] 26/1/2023 13:38

Same on IG, but I don't know their 'normal' approach to this share.

[skyship] 26/1/2023 13:36

Went to CMC to short this at 102.8p as I believe they are well over-valued v. all peers. CMC state unable to short AEWU!!! Why not I wonder...

[ramellous] 25/1/2023 16:03

Ex dividend tomorrow

[sleepy] 19/1/2023 21:44

Seems to me that someone got their sums wrong - should be closer to £100 per sq ft than £10?

NEXT, Bromley (retail) - In late November, the Company completed the purchase of a freehold retail asset in Bromley for GBP5.30 million, reflecting a low capital value of GBP10 per sq ft and a net initial yield of 8.7%. The asset is located in a prominent position on the western side of the pedestrianised Bromley High Street and provides 54,215 sq ft of accommodation, let in its entirety to Next Holdings Limited. Next Holdings Limited has occupied the property since 2000 and, in September 2021, renewed on a four-year lease at a rebased level of rent. A comprehensive store re-fit was undertaken by the tenant at this time, demonstrating the retailer's commitment to the location.

[skyship] 19/1/2023 19:00

Brucie - answered that elsewhere - clearly EPIC a better bet!

[smidge21] 19/1/2023 14:13

If you like owning B&Q sheds then the latter is for you. In short yield might be the only similarity

[brucie5] 19/1/2023 14:01

OK, I doff my cap to any experts here who can tell me whether this is buy or hold and in relation to Epic, which yields similar..? TiA.

[lord gnome] 19/1/2023 10:56

Good point, SteMis.

[spectoacc] 19/1/2023 10:56

Caps are a bete noir of mine - all this "inflation-protected, inflation-linked" stuff is baloney, in most cases. SIR, LXI, AIRE etc. Compounding 14% RPI is one thing; compounding 3% or 4% quite another.

Personally think there's a very real chance of CB targets being reset to 3% (CPI, so 4%+ RPI) in the next few years.

Well spotted @nickrl - and they're not alone, didn't someone (EPIC?) grant an 18 month rent-free to BME simply for extending a lease? Might have mis-remembered but it shows the state of the market when even the hugely expanding Lidl can get long rent-frees. [Edit - but fair point, @SteMiS. Trophy tenant perhaps].

I don't mind AEWU - I think they're a good operator - but there's tougher times ahead for all the REITs, and I see NAVs continuing to fall rather than flatlining.

[stemis] 19/1/2023 10:55

Central Six Retail Park, Coventry (retail/leisure) - In October, the Company completed an agreement for lease with new tenant, Aldi Stores Limited, for vacant units 8 & 9. Aldi will enter into a new 20-year lease with a 15-year tenant break option at a rent of £270,166 per annum, reflecting £13 per sq ft

So that's about 20,782 sq ft of the 148,765 sq ft. I suspect the incentive for AEWU is that bringing a tenant like Aldi into a vacant part of the development will improve the letability (and rents) for other units

[riverman77] 19/1/2023 10:34

And RPI capped at 3% - very little protection if inflation stays high over next 20 years.

[lord gnome] 19/1/2023 10:22

That's the way I read it nickel. Looks like Aldi drove a hard bargain. With deals like that, no wonder the divi still isn't covered. Call me in five year's time.

[nickrl] 19/1/2023 10:18

AEWU bette noir of course is paying that divi come what may despite it not being covered and it still isn't. It can't afford to do it for ever of course but that decision point remains at large and they are forecasting coverage by Q3 now. Feels like a bit of catch up here as there was quite a bit of disparity amongst propco/reits at Q3 updates. Personally i reckon NAVs tread water for next couple of qtrs as whilst its seems clearer, barring a black swan event, economy will muddle along its not clear whether a sustainable pick up is likely yet or not.

They continue to set the benchmark on quality of updates although this particular lease event caught my attention.

"Central Six Retail Park, Coventry (retail/leisure) - In October, the Company completed an agreement for lease with new tenant, Aldi Stores Limited, for vacant units 8 & 9. Aldi will enter into a new 20-year lease with a 15-year tenant break option at a rent of £270,166 per annum, reflecting £13 per sq ft, to be reviewed every five years based on compounded annual RPI, collared and capped at 1% and 3% respectively. The letting is subject to the landlord securing planning permission for 1) change of use to food use (achieved in July 2022), 2) external alteration works (achieved in November 2022) and 3) extended delivery hours, as well as landlord works which will commence this month, at a cost of £894,212. Lease completion is targeted for July 2023. The letting also includes a 12-month rent-free incentive"

This reads to me that to get a 20 year lease they've given them 12mths rent free and need to spend 900k on the building - so effectively four years rent free!

[riverman77] 19/1/2023 09:58

Lucky to have got out of this a few weeks ago - I thought their high yielding properties would be more resilient and was not expecting such a large drop in NAV. Even after today's fall, still looks expensive compared to peers such as CTPT, so will stay well clear of this for now. Possibly interesting around 85p.

[skyship] 19/1/2023 09:15

EDIT - sorry, miscalculated stats!

Problem for the AEWU share price was the very nominal discount.

Congratulation Smidge - a great sale. Would have joined you with a short if I'd seen this disaster - stupidly missed the RNS in spite of it being on my Monitor.

[smidge21] 19/1/2023 08:40

I'm a long term holder (of various AEW funds) but trimmed AEWU at 103.05 this morning. I agree with previous posts: market conditions likely to weigh on share price for a while and discount should widen. Rotation into Retail sector of market should have more to go - if only to partially address extreme divergence

[gliderpilot2002] 19/1/2023 08:29

A much bigger discount to NAV is needed.

[spectoacc] 19/1/2023 08:14

36% LTV now.

On NAV:

"Nevertheless, this compares favourably to wider market declines with the CBRE monthly index showing capital value falls of 6.8%, 5.5% and 3% for all UK property in October, November and December respectively."


It does, and AEWU often trades near to par thanks to the yield, but - was this the last qtly NAV fall? No chance IMO. Falls should moderate but going to be more ahead.

[hugepants] 19/1/2023 08:13

That Nav fall looks well within expectations. Lots of industrial and add in the gearing.

[lord gnome] 19/1/2023 08:08

The NAV fall is a bit of a shocker. I hadn't expected that. Better value elsewhere, so I have sold out first thing. Can't see it making progress for now.

[spectoacc] 19/1/2023 07:31

Surprisingly large quarterly NAV fall:


"· NAV of £166.24 million or 104.93 pence per share as at 31 December 2022 (30 September 2022: £193.08 million or 121.88 pence per share)."

[lord gnome] 23/12/2022 21:55

Looks like you timed your buy quite well CWA1.

[cwa1] 23/12/2022 11:35

OK then, time to 'fess up, who's responsible for the mid-morning jump?!

[cwa1] 22/12/2022 16:10

Decided to have a few of these at under 97p, seems like a sensible price even if there's further to fall before it stabilises. Liked the last announcement regarding the assets they acquired. It'll be tough out there-but hopefully there's a future for that type of asset. Will be nice to see the dividend covered again...