Well, that bounced! |
Bought some more this am. |
Any issue is on UK vacancy rates, would guess the market is focused on this, besides reducing gearing. |
"Decision - 1. The appeal is dismissed."
I would very much like to hear the reasoning behind such a misguided decision.
Such decisions should be taken out of the hands of braindead councillors. |
Not sure why office users would want more space per employee. Cost-cutting the order of the day, and fewer employees with the NIC rise.
But that's UK of course - fewer employees on the continent with a sclerotic economy. Interesting that both France and Germany going to have unexpected GEs soon.
The word "eventually" is doing a lot of heavy lifting, but I'd not argue CLI is expensive. Just that there's better things to buy, with more potential upside and more divi safety.
5 years? The definition of a long-term trade is a short-term one gone wrong ;)
@loglorry1 - not on financials it ain't, tho agree GSF in particular is opaque. It's also mind-bendingly cheap IMO. If it was single-country it would have been taken out by now IMO, & still wouldn't rule it out. |
Obviously technology is not a strong point!
Appeal Ref: APP/E5900/W/24/3345893
9 Prescot Street, Tower Hamlets, London E1 8PR
• The appeal is made under section 78 of the Town and Country Planning Act 1990 (as
amended) against a refusal to grant planning permission.
• The appeal is made by CLS Prescot Ltd against the decision of the Council of the London
Borough of Tower Hamlets.
• The application Ref is PA/24/00057.
• The development proposed is the change of use from office use (Class E) to a dual
hybrid use for higher education uses (Class F1(a)) and office use (Class E).
Decision
1. The appeal is dismissed. |
CLI is much better quality than GSF and SEIT. The latter worry me esp GSF and I wouldn't invest. Offices might be out of fashion but I don't really think AI and home working will kill them off. |
Not sure what it's about, but in general at least part of CLI's problem is how much cheap stuff there is out there. Why would I buy over-geared, debt-risk (but not bankruptcy risk) CLI yielding 10%, versus eg SEIT, getting sold down by Rathbones, at 12%. Or NESF at 12%, or GSF at 14%.
Because it offers more potential upside if you believe that well located semi prime offices will eventually be dragged up by Prime's increasing rentals/restricted availability, especially as WFH slowly reverses as appears to be happening. And office users want more space per employee.
Which is going to be higher in 5 years?
I own all four having recently bought back SEIT, Gore and NESF. Also bought FGEN
I assume CLS suffering from exposure to France |
Presumably change of use application for The Artesian has been turned down.
Strath - Can you please confirm one way or another... |
Classic :)
Not sure what it's about, but in general at least part of CLI's problem is how much cheap stuff there is out there. Why would I buy over-geared, debt-risk (but not bankruptcy risk) CLI yielding 10%, versus eg SEIT, getting sold down by Rathbones, at 12%. Or NESF at 12%, or GSF at 14%.
All with different pros/cons, but the market's changed. |
That’s a link to your hard drive.. |
Not been forthcoming about this or it's effect on NAV |
made a maiden investment here today at.82p |
Maybe they transferred property/buildings to another group company which had more collateral or a lower loan to valuation level leaving basically group shell companies behind that were then dissolved. |
Jeff H - Thanks for that. I can see where you're coming from as CLS Scotland Limited for example would appear to be one of those companies as in April 2023 it was voluntarily wound up and then restored in July of the same year. However those that I am referring to, for example CLS Gresham Limited, have not previously had winding up proceedings started. |
..and we finish even lower |
 I think it refers to the below strathroyal:-
"In April 2023, CLS Holdings plc dissolved 8 subsidiaries (the 'Companies'). Before the Companies were dissolved, capital reductions and distributions of the net assets of the subsidiaries, primarily represented by inter-company receivables of £17.1m, to the Parent should have been executed. However, they were not. As a consequence of this, as a matter of Law, on dissolution of these Companies the technical titles to the inter-company receivables were transferred from the Group to the Crown.
The Directors have taken legal advice and started the process to restore these Companies. Thereafter, the Directors can execute the capital reductions and make appropriate distributions to the Parent of these Companies assets....."
So the companies did not own any of the properties but had transferred money to other of the group companies (hence the inter-company receivables mention)
The process of dissolving these subsidiaries was not carried out correctly and application to restore the companies back has subsequently been made and once again these subsidiaries have been dissolved.
I guess it makes it easier from an admin basis as I assume the subsidiaries were basically dormant, maybe owned buildings/property in the past but not now, so saves on admin, audit fee etc dissolving them.
The "appropriate distributions to the Parent" sounds like a dividend which will go to distributable reserves whereas Share Premium accounts are non-distributable although you can apply to the court to as presumably in this case to reduce them, so cancel/reduce Share Premium by say £15m and increase Reserves by a corresponding £15m |
Any company account experts on here? I see that a number of the subsidiary companies have reduced their share premium accounts last month (8 that I can see), is this likely to be connected with the properties they are selling or simply a book keeping exercise? |
THe assets are discounted by about 30%, which is hefty.
Student development sold for a good price but no one seems interested in buying their non redevelopment offices at or close to book. UK Vacancy very high aswell at almost 20% demonstrating the clear mismatch between supply and demand.
IMV the risk /reward here is very good. THis is not a basket case like Rgl as there are higher quality assets in London and major cities, with LTV under control. |
True, & they were buying heavily in the 120's. But they'd need that well behind them to be able to pitch a low-ball bid I think.
Not saying CLI's not good value, but there's plenty I'd prefer ahead of it. |
@specto dont disagree but here the family own so much that always remains a possibility at depressed prices they will take the remainder. |
Don't see the appeal of a heavily indebted office REIT when there's eg FGEN at 10% growing yield, or NESF at 12%, or SEIT's spread of investments at 11.7%. All at large discounts if NAV's your thing (40%, in SEIT's case).
Opportunity Cost, with often contracted revenues & guaranteed uplifts in the latter 3's case.
The economic outlook's changed, particularly regarding rates, & whilst it might change back, I want to be (securely) paid to wait. |
Comparable office reits have fallen further over 3mths
free stock charts from uk.advfn.com |
The 30YR Gilt is hitting 5% - unfortunately it makes sense for these types of stocks to sell off. I'm not hugely surprised. I bought a few more. |
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