Capital & Regional Share Discussion Threads

[zccax77] 23/6/2019 12:54

I very much doubt anyone would bid for CAL's porfolio. Most of it is tired stock from the 90's in low footfall areas. Going to these places is depressing and they also have a lot of DEBS which is a bad omen, I do not see them being around in 5 years time. However the only trump card they have is their London/SE location and most of these assets can be re-purposed very easily. However the cost to re-purpose will be very high.

[zccax77] 23/6/2019 12:48

What does that mean? re-balancing. Should that not occur on the last day of the month?

[tiltonboy] 23/6/2019 06:34

It was re-balancing on index changes. There was huge volume onva lot of stocks.

[2wild] 22/6/2019 22:19

Not only did 21.3 million change hands in the closing auction on Friday, there was another 10.9 million trade at 18:45 plus a bunch inbetween totalling another 4 million. Thats 36.2 million shares (5.2% of MC) all traded at 13.78p. Someone's been working overtime. Could a bid be coming?

[zccax77] 21/6/2019 17:47

Plus if they sold, the councils would buy them at a knock down price. The councils can borrow at 1% with a 50 year amortisation term.

[zccax77] 21/6/2019 17:45

DEBS is the issue, they will drag all these centres down. These places just do not have the footfall to have a dept store, what will they do with all that space. I cannot see a way out, other than D4E swap. Too much cash required to re-purpose.

[spectoacc] 21/6/2019 17:40

Another question - where are all the director purchases?

@Gary1966 - you might say 10% isn't tumbling/crashing, but as you pointed out, LTV is 48%. Limit is 70% under existing covenants. I suggested 2 years from now...

As @swindon41 says, there's a strong feeling that rents (& by extension, NAVs) have hardly even begun to fall. BLND recent results showed a c.30% fall in dept store valuations in a single period. A single period!

Worth looking at what percentage rent reduction NXT have achieved, on average, each time one of their stores has come up for renewal (clue: it's a lot!). There's an awful lot of historic/legacy stuff on what now looks like crazy rents, that won't re-let at anywhere near that level, and is either going to come down through CVA's or on renewal.

Again, if I'm completely wrong, CAL looks a buy. Someone had better tell the directors.

[zccax77] 21/6/2019 17:35

The main plus I can see is that most of their sites are in/around London and hence unlikly to lose too much value. The main issue is that their main anchors are DEBS, and they have a lot of Arcadia and Monsoon. The latter will decimate income and hence others will want a reduction or at worst leave. These sites just do not get enough footfall. However if they were sold for an alternative use then the may get a lot of money at auction just because of locations. See what happened to the nichols centre in maidenhead.

[gary1966] 21/6/2019 17:21

Dividend has been rebased and cash being invested in the existing portfolio.

[swindon41] 21/6/2019 16:37

Rent proposition might look cheap v historical comparisons but looking ahead , this is where the doubts are. Rents are going to get hammered imho - downwards pressure from DEBS, BOOTS, ARCADIA and M&S......and if you were the existing tenants you'd be piling on the pressure to CAL for rent renegotiation wouldn't you?

Alongside weak management, the property portfolio looks mediocre at best. Gearing is too high for dividends to be sustained - if cash was not a worry CAL would be launching share buy backs but they can't can they?

[gary1966] 21/6/2019 16:15

EPRA NAV fell 10% so not tumbling/crashing. How much more to come off? Not sure myself. Occupancy and footfall figures very good. Rent proposition cheap. LTV 48%, not mind blowing. As I said I can’t reconcile with CAL being near life support yet.

[spectoacc] 21/6/2019 15:51

@Gary - if CAL can survive, they're surely worth loads more (as are INTU, as are HMSO, and several more).

The covenant issue is that at current rate of NAV decline, I reckon they're breaching bank covs 2 years from now. So it's a gamble on 1. Having decent management (which they don't), and 2. On the High St (or the CAL equivalent, tired legacy shopping centres) surviving and indeed starting to go back up in value.

One thing's for sure - a RI can't save them, they missed the boat on that. A D4E could, but probably another 90% to fall.

Takes two to make a market - I'm not long or short CAL.

[gary1966] 21/6/2019 15:45

22.4m shares just gone through and have to assume that is what has been worked for some time and decimated the share price. Now I am going to be interested to see where it goes now as I don’t buy in to the complete doom and gloom. Operationally the company is doing well. I don’t see the covenant issue. But then I am down 65% on a small investment which clearly shows I know nothing. :-)

[spectoacc] 13/6/2019 05:52

Why? It's going c.10p lower than that IMO. It's either a buy here (because it will survive) or my view on the covenants is accurate.

Silence from the co, and where are all the huge director buys?

[zccax77] 12/6/2019 19:53

Will buy at below 10p

[spectoacc] 07/6/2019 13:28

Now dropped 10p since I first posted on here about 6 weeks ago Not short, certainly not claiming any credit for the fall, but - CAL is likely going to 1p IMO.

[spectoacc] 04/6/2019 07:12

Covenants are in danger because NAV is tanking, and will continue to tank, unless we've reached "peak online".

[hugepants] 03/6/2019 11:13

Id be more convinced that the convenants were in danger if the footfall was going down! But its not, its still rising strongly as of last results. If the footfall remains strong you'd think they can maintain rents and replace the likes of DEBS who aren't actually closing in the CAL centres but are reducing rents (CVAs).

[swindon41] 01/6/2019 09:23

CEO buying?
At such a 'low' market cap where are the CEO's share purchases?

This says all you need to know imho. Downward rent reviews coming soon, Boots store closures, Top Shop too, alongside M&S and DEB.... bank covenants edging close to breach.

Too much debt here but the bond holders will take control before shareholders get a sniff. Better risk/ reward plays out there and juicy dividends too : DGOC, FRES, SIA

All imho. The trend is your friend.

[zccax77] 30/5/2019 17:57

Those yields look too low, should be atleast 9%+. Do you think they can get bank finance? who would lend them any money?

[spectoacc] 30/5/2019 08:13

Much as I hate to link The Guardian:


This was the "shopping centre for £1" that attracted a lot of press - actually sold for £310k+legals, fees, stamp. Great - except it now soaks up c.£200k a year in empty rates, and originally cost £4.25m to build - in 1981! Sums up the way the market is going, albeit it's the lowest of the low.

Anchor tenants are the key - this one lost its Tesco - and things like the once reliable TopShop are starting to disappear.

Incidentally, local authorities are often buyers of dilapidated shopping centres, using the govnt loan scheme. This is where NRR is looking to make money as an advisor.

[hillofwad] 30/5/2019 06:39

It's not that Aberdeen Standard need the money either !!



hxxps://www.vectorstock.com/royalty-free-vector/comic-book-style-cartoon-red-flag-vector-24081470

[spectoacc] 30/5/2019 06:27

Wait till INTU's start coming on the block......

[hillofwad] 30/5/2019 06:26

Spec
Maybe sooner than we think Take a butchers at this !!!

hxxps://www.propertyweek.com/news/alteris-agrees-uk-malls-deal/5102926.article

Aberdeen Standard close to selling two shopping centres in Crawley and Newbury to Alteris fund for £140m (8.5-9% yields) having paid £190m for former in 2004 and £120m for latter in 2011. Anglo-German buyer yet to secure debt finance.