Abrdn Property Income Share Discussion Threads

[spectoacc] 12/5/2023 17:18

@Flyers61 - in antiquity? ;)

Good luck API buyers - I'm not one.

Assume yesterday's post-NAV calls have encouraged a few to cut.

One of several starting to drop through recent lows.

[flyer61] 12/5/2023 17:03

Had this at a 5 star hotel in Athens last month….the bell hop(actually a 50 year old man) went on about the city being invaded by outsiders…..

[dr biotech] 12/5/2023 16:44

Well I added £5k just before the close. I'm looking at jacking in the day job in the next few years and if I averaged 8% across my entire holdings I'd be able to go to both Rhodes and SW France

I've been to Rhodes twice, about 20 years apart. I've had two tours of the Old Town, first was with a decent sound and light show that was stopped during the greek financial crises. Second tour was by a guide that hated immigrants and was possibly the worst tour guide I've ever had. Knew all the dates when the buildings were put up (or just made them up, I mean who gives a toss if it was built in 1832 or 1894?, he never told us any history) and told us again that he hated immigrants. All I remember was that he hated immigrants (not tourists apparently). Must have told us every 10mins. Bit like reading this post.

[cwa1] 12/5/2023 16:22

Indeed , there does seem to be a persistent seller about but, as ever, it's a double edged sword that lets those that are interedted buy some more cheaply than we might've otherwise have done. The only question is: is there still stacks to go from the seller and will they crater the price just to get out(thus making this share price look expensive rather than cheap!)?

[cc2014] 12/5/2023 16:11

Quite a persistent seller this afternoon.

[skyship] 12/5/2023 15:53

CWA1 - Glad you too seeing the value here.

Flyer - sounds very pleasant. A bit cooler here in SW France; and this month wet, wet, wet!

[ghhghh] 12/5/2023 15:53

Ghhghh….agreeon the replacemeny cost however I think any reduction in interest rates IMHO is more than months off…maybe a year from now.

Possibly but no one knows how this plays out. Interest rates, reducing money supply and credit squeezes are impossible to model in combination.

And history suggests that REITs will rally well ahead of interest rates falling

[cwa1] 12/5/2023 15:48

FWIW I've just taken a few here at a little bit under 51p. It's not exactly top of my conviction list but it sports, hopefully, a decent yield, reasonable discount and very recent news that wasn't scandalously bad. Oh and I like to keep you lot company too ;-)

[flyer61] 12/5/2023 15:37

Typed on my phone on a beach in Rhodes…beer in hand…

[flyer61] 12/5/2023 15:36

Ghhghh….agreeon the replacemeny cost however I think any reduction in interest rates IMHO is more than months off…maybe a year from now.

Sky…you selling EPIC…spoiling my weekend, but I agree with your sentiment..

[skyship] 12/5/2023 15:09

Many recorded sales actually buys c51p...inc. two of mine!

51.1p = 38% discount & 7.83% yield.

Average purchase price now 53.4p; at which level yield on cost = 7.49%; and discount 35.2%.

Happy now to await events, falling inflation & falling interest rates..

Purchases funded by recent sales of EPIC as not really trusting the BoD to deliver value there.

[ghhghh] 12/5/2023 15:05

@speedsgh - I'm increasingly unconvinced REITs work, at least in the UK. Balanced against that is that the FTSE 100 has barely done much better.

But we recently had 14 years of ZIRP - if that didn't juice their returns, what will?

(Or - is the fact they've been buyers during ZIRP indicative of the poorer returns going forwards. Eg buying at office building at 6%, or 5% over Base, doesn't look so clever when interest rates move up to 4.5% & that same office building now needs to yield 9%, at a time of static/falling rents).

REITs have underperformed because 14 tears of low inflation!

We have had the kick in the gonads from rapidly rising interest rates knocking capital values.

Within months we should reap the reverse benefit of falling interest rates plus c. 25% cumulative inflationary pressures on replacement cost which must filter through to existing prime valuations. Happy days are just round the corner, subject to market meltdown

[flyer61] 12/5/2023 14:30

You have a point Spec….reminds me of the pension industry…..incredibly self serving.

[spectoacc] 12/5/2023 14:23

@speedsgh - I'm increasingly unconvinced REITs work, at least in the UK. Balanced against that is that the FTSE 100 has barely done much better.

But we recently had 14 years of ZIRP - if that didn't juice their returns, what will?

(Or - is the fact they've been buyers during ZIRP indicative of the poorer returns going forwards. Eg buying at office building at 6%, or 5% over Base, doesn't look so clever when interest rates move up to 4.5% & that same office building now needs to yield 9%, at a time of static/falling rents).

[hugepants] 12/5/2023 13:53

There would appear to be some volume being shifted. Narrow spread.51.1p to sell51.25p to buy

[speedsgh] 11/5/2023 14:58

And according to the AIC website...

5yr NAV total returns

AEWU: 63.5%
API: 20.1%
BCPT: -0.4%
CTPT: 10.4%
PCTN: not listed
SREI: 12.1%
UKCM: 4.7%


10yr NAV total returns

AEWU: N/A (launched May 2015)
API: 164.7%
BCPT: 84.3%
CTPT: 121.7%
PCTN: not listed
SREI: 113.1%
UKCM: 83.0%

[speedsgh] 11/5/2023 14:28

@Specto - I was going to label the data "NAV progress" but thought better of it :-)

EDIT - to be fair to API the majority of their peers have not fared any better. PCTN appears to stand out...

AEWU - 31/10/15: 97.09p - 31/3/23: 105.48p
API - 31/12/15: 82.2p - 31/3/23: 82.4p
BCPT - 31/12/15: 135.3p - 31/3/23: 118.7p
CTPT - 31/12/15: 99.9p - 31/3/23: 96.6p
PCTN - 31/12/15: 75.7p - 31/12/22: 102.2p (FY results to 31/3/23 to be released 25/5)
SREI - 31/12/15: 62.4p - 31/12/22: 62.0p (FY results to 31/3/23 to be released 8/6)
UKCM - 31/12/15: 86.7p - 31/3/23: 80.6p

[spectoacc] 11/5/2023 10:51

Not a fan of uncovered divis, and they appear to have achieved the better coverage by reducing CapEx. More CapEx to come at Hagley but if they can continue to pare CapEx back, perhaps they'll get close to coverage. But they'd have been better with a rebased divi IMO.

@speedsgh - enjoyed that, thanks.

@nickrl - they won't be too concerned about the RCF because they think interest rates are coming back down soon.

[nickrl] 11/5/2023 10:16

I was surprised how much the RCF has been loaded up already with more to come for the Knowlsey development. So given another 0.25% today seems inevitable that's another 100k on interest charges gone. That said they have boosted income by close to 2.4m less what they don't tell us has been lost from breaks/expires but i can deduce from the NIY that about 1m has gone so up a nett 1.5m. Also the benefit from the reduced mgt fee will feed through worth about 300k/pa. My forward view is cash cover is mid 80's for FY23 which if property prices were rising might just be acceptable but i will leave on the watchlist for the time being.

[speedsgh] 11/5/2023 09:00

NAV performance:

82.4p as at 31/3/23
84.8p as at 31/12/22
106.1p as at 30/9/22
110.7p as at 30/6/22
106.6p as at 31/3/22
101.0p as at 31/12/21
93.1p as at 30/9/21
88.3p as at 30/6/21
85.3p as at 31/3/21
82.0p as at 31/12/20
78.8p as at 30/9/20
79.6p as at 30/6/20
83.2p as at 31/3/20
89.9p as at 31/12/19
90.3p as at 30/9/19
91.1p as at 30/6/19
91.1p as at 31/3/19
91.0p as at 31/12/18
91.4p as at 30/9/18
90.1p as at 30/6/18
89.4p as at 31/3/18
87.6p as at 31/12/17
86.0p as at 30/9/17
83.9p as at 30/6/17
81.4p as at 31/3/17
81.0p as at 31/12/16
79.0p as at 30/9/16
81.8p as at 30/6/16
82.3p as at 31/3/16
82.2p as at 31/12/15

[skyship] 11/5/2023 08:27

Dividend cover massively improved already; personally had expected c85%:

Dividends

Following the dividend being maintained at an annualised rate of 4p per share
since December 2021, the dividend cover for Q1 2023 is 88.6%. The Board has
provided guidance of its intention to maintain the current dividend level which
it believes will be substantially covered in 2023 and 2024.

[spectoacc] 11/5/2023 07:59

Well, rates will go +0.25% today, and the market thinks another 2 rises are possible.

Also assumes Morrisons aren't run into the ground.

[skyship] 11/5/2023 07:49

"...Although initially the cost of servicing that debt is high the income from the asset is higher, and that differential is expected to increase as rates decline and the rent continues to grow."

Just a statement of fact surely!

[spectoacc] 11/5/2023 07:18

One of the poorer NAV performances. And they couldn't resist some economic commentary! Some of it bordering on bizarre, but they seem to at last recognised that interest rates are about to go to 4.5%.

This jumped out re the Morrisons purchase:

"...Although initially the cost of servicing that debt is high the income from the asset is higher, and that differential is expected to increase as rates decline and the rent continues to grow."

Can't help themselves.

At least that void rate is coming down.