CT Property Share Discussion Threads

[colonel a] 05/10/2021 10:47

Point taken.
A 1% increase in gross assets would be do me.

[spectoacc] 05/10/2021 10:38

@Colonel A - £335m of assets (surely higher by a good few % at next report), so £19m of purchases equates to relatively small beer. Not nothing tho, I agree, & backing for our divi by using the cash.

(Better than buybacks tho? Only if my +50% reversionary uplift is close).

[colonel a] 05/10/2021 10:31

Small beer ? >10% of the market cap.

It does not need to be a great deal but taking a 3+ year view is what you would want from a REIT.

[spectoacc] 05/10/2021 10:29

I've seen no stand-out deals in fairness. Hopefully the reversionary value of Colnbrook eventually bumps it up 50% or so. Was a time when 4% felt like the top of the market.

[hindsight] 05/10/2021 10:15

It will not be a great deal, market too efficient in those sectors at present. The stand out deals they are ignoring and such things will be remebered when an activist comes knocking.

[nickrl] 05/10/2021 09:35

Id like to know what "highly reversionary" implies on the industrial asset yield but looks like we will have to wait three years. At least they've finally deployed some proceeds.

[spectoacc] 05/10/2021 07:39

Small beer but look reasonable enough. The manager must have finished his beach walk.

[cwa1] 05/10/2021 07:35

Property Transactions

BMO Real Estate Investments are pleased to announce that the Company has
acquired two freehold properties for a total of £19.4m, secured off-market and
at an accretive combined yield.

The acquisitions represent the successful delivery of the key near-term
objective to recycle proceeds realised from a number of strategic disposals
from the High Street and Office sectors into the Retail Warehousing and
Industrial sectors, targeted for their robust occupational demand, income
resilience and favourable performance prospects.

The first property, an industrial asset in Colnbrook, Heathrow, was acquired in
September for £12.1 million and is highly reversionary with a net initial yield
of 4.0 per cent. The asset is fully let to a vehicle servicing centre for a
further 3 years in a market that is characterised by very tight supply
dynamics, offering opportunity for value creation through near term asset
management.

The second property, also acquired in September, comprises a retail warehousing
scheme in Banbury, Oxfordshire, occupied by home-improvement tenants Wickes and
Topps Tiles for a further 4.2 years. The property was acquired for £7.3
million, reflecting a net initial yield of 6.3 per cent. The acquisition
enhances the Company's exposure to the functional, low rented part of the
retail warehousing sub-sector, which continues to see material yield
compression based on robust occupational fundamentals coupled with the
potential for alternative uses, protecting long-term value.

These acquisitions follow the successful disposal of the office property
Marlborough House, St Albans, in July 2021, which was sold at a premium of 8
per cent to the Q2 2021 valuation, and at an opportune time in advance of the
lease expiry in early 2022.

[spectoacc] 04/10/2021 13:55

Lager lager lager.

Agree, my 2nd largest REIT holding, and arguably the most undervalued, whilst Industrial going so well (& current logistics probs means more demand for warehousing).

[redsonning] 04/10/2021 12:55

As long as they continue to collect rent as good as they have been doing this is fine with me. High discount makes it good value, and limits downside in any market corrections. Meanwhile dividend yield is good, and whatever doesn't get paid out adds to the NAV number. And there is the possibility of an eventual merger with a lager trust. Can't see what's not to like! As usual Skyship knows what he's doing!

[hindsight] 29/9/2021 20:14

Hopefully somebody makes an offer then, I will not defend such poor shareholder employees

[chopshs] 29/9/2021 17:40

Sky - I asked them about doing buybacks in late April 2020, very shortly after buying in at a circa 50% discount. Their reply was that they saw 'minimum gains from buying back stock, without reducing the capital base of the company significantly, something that the Board would be wary of given liquidity, the market cap and cover observations at this time. Rest assured though, this subject is always on the agenda.' I sold out again shortly after receiving this. I have been in and out again subsequently when the price looked particularly out of kilter but I suspect BREI will always have a high discount relative to the sector.

[chucko1] 29/9/2021 12:31

Never saw it - now I'm curious!

[cwa1] 29/9/2021 11:16

Groan, I had almost forgotten about that particular video nasty. Thanks ever so much of reminding us all...

[skyship] 29/9/2021 11:04

chucko - BREI is actually one of my largest holdings, 2nd only to EPIC.

I'm just rather disillusioned with them after viewing that total waste of space investment manager video, which is still up on their website. Truly ghastly and a dreadful waste of money.

[chucko1] 29/9/2021 10:16

Not every REIT can be interesting! This one will have its day - no idea when.

But it's tradable.

[skyship] 29/9/2021 09:39

We should be seeing the Annual Report this week. I'm expecting another rather bland and unambitious statement - something that rather marks out this Board and this investment manager. They seem to just drift along; let the markets take them where they want to go; and pocket their fees regardless.

They can't buy properties at a 28.5% discount, so far better to put buybacks to the test and buy the company's shares instead. I truly expect that regardless of the cash spent, they would raise the MCap. There are unlikely to be any big sellers as even at 80p they would still be on a 22% discount.

[hindsight] 24/9/2021 10:22

Added few in closing auction, quite weak but cant say mind, price in 2 years is what matters

[cousin jack] 23/9/2021 09:34

Available in the 72’s again this morning.

[cwa1] 17/9/2021 16:40

Over 1/4 a million went through at 72p in the auction. I think I might have been interested in some of those if I hadn't been dozing and thinking of the weekend :-)

[spectoacc] 15/9/2021 16:15

At this stage of the cycle, I'd want nearer 20% than 30%, personally. But agree that too low isn't taking advantage of long-term low interest rate fixes.

(Trouble with "buy in the regions at 8%" is how that looks with voids or recession).

[skyship] 15/9/2021 15:28

SLI LTV just 17.6%; but targeted on reinvestment into the range of 20%-30%.

Re LTV - posted this on the EPIC thread earlier today:

======================================================

Commercial property is actually a remarkably simple and profitable business in a low interest rate environment.

Fix your borrowings for the medium term at c3%pa, then buy properties in the regions on an 8% yield. Great arbitrage.

IMO the best LTV rate is in the range of 25%-35%. Too low, as with UKCM, means failing to capitalise on the current economic situation. Too high just means a tad more Risk, as per RGL.

[spectoacc] 15/9/2021 14:16

BREI certainly bordering on sub-scale at £178m mkt cap (vs £766m for BCPT), but doubt BREI s/holders would want BCPT's London office & retail exposure.

Respective assets are BREI £337m, BCPT £1.25bn (HL).

SLI might be a better fit (£280m/£457m) but is very conservatively geared atm.

Would be up to the boards not the managers.

[riverman77] 15/9/2021 14:13

What is the point of having 2 virtually identical BMO property trusts? Surely they should be merged. This might also improve the rating of both due to better scale.