Cls Share Discussion Threads

[skyship] 01/12/2021 07:19

P - Dropped into the SHA thread this morning. The thread starts where I last finished; so saw this from you on 9th Nov.:

"Sky, Whilst you're looking in could I ask: If I wish to hold a single PropCo for the next 5-years which PropCo in your view combines the highest quality assets (residential, retail or specialist) with long, inflation protected leases."

VERY difficult question, especially for me as my time horizon is so different.

Firstly, from the outset, I wouldn't plump for one. Split your proposed sector allocation across 3 contenders.

As I have frequently posted, I wouldn't go for any propco trading at or near premium NAV; so that rules out quite a few.

Also I wouldn't opt for any specialists as fashions / circumstances change. So go for generalist players.

On balance for me: AIRE, SLI & SREI.

Perhaps pose the same question on the CP+ thread - would be interesting to read the responses.

[skyship] 30/11/2021 21:01

P - :) - as with many of us nowadays!

[badtime] 30/11/2021 20:48

I'm tempted

[ptolemy] 30/11/2021 17:03

Sky - #438

"vulnerable to weakening demand, functional obsolescence and rising refurbishment costs"

You could be describing me...

[skyship] 30/11/2021 16:39

Indeed, might that be the end of the tap?

[cwa1] 30/11/2021 16:36

Chunky looking UT at the end there. Almost half a million went through at 203.5p

[flyer61] 29/11/2021 15:44

Bought in at 204P today. Hope you guys are right!

[playful] 26/11/2021 19:33

I just can’t help but keep buying this especially at such a daft discount.

[skyship] 25/11/2021 20:53

I think I understand - but perhaps don't. You think CLI is pricing in a 15% valuation fall? If so, then really underlines what value there is here...

[hindsight] 25/11/2021 17:05

Skyship, was making point what office fall is being priced in CLI shares, not whether it will happen or not. That question I was posing for the experts on here, thank you for posting some quotes

[skyship] 25/11/2021 15:33

Just 2 quotes from recent Q3 statements:

SLI: “The demand for prime office assets was evident once again this quarter”

SREI: “Uncertainty as office tenants reassess their requirements weighed on the sector with average capital values rising by 0.8% over the period. Whilst this led to take-up over the first half of 2021 being 49% below the pre-pandemic average, vacancy rates have stabilised in Central London and prime office rents in Leeds, Manchester and the West End are increasing. This reflects a polarisation with healthy demand for well specified offices in city centres and close to leading universities, which enable companies to attract highly qualified staff. In contrast, more secondary offices, particularly in out of town locations, are vulnerable to weakening demand, functional obsolescence and rising refurbishment costs”

[skyship] 25/11/2021 15:18

Office valuations down 15% doesn't seem to accord with anything we've seen in UK's Q3 stats. Down 1% perhaps...

EI - joined you for a few @ 207.5p today. Both in SIPP and a CFD.

[essentialinvestor] 24/11/2021 09:53

Low possibly in ?,

Managed to buy a small amount under 2.07.

[essentialinvestor] 23/11/2021 18:05

Don't think you are missing anything Nick, other than a dreadful mess
with COVID in Germany and lockdown, coupled with now rising case numbers in France.

Perception being this may weigh on lettings and disposals -
and to an extent it may.

From the recent Capital Markets day, CLS appears to view 2022 as a year marked for significant disposal activity.

I don't mind going against both sentiment and share price trend, so if unable to buy
may indicate the revulsion/fear and loathing stage is somewhere near.

Obvs if wider equity markets were to sell off as well, then
more than possible for this to trade lower still.

[nickrl] 23/11/2021 17:52

hindsight looks like your analysis has played out again today but as EI says are we getting to an inflection point. Me thinks i just need to bite the bullet here the deviation to comparable stocks is getting just ridiculous - what are missing?

[essentialinvestor] 23/11/2021 17:32

Tempted today but have tbh and say could not click the buy button,
may be a near a low!.

[cwa1] 23/11/2021 17:28

Well this certainly isn't a happy bunny. Time to add, or best left alone until the trend bottoms out?

[hindsight] 23/11/2021 14:26

nickrl, no problem was just saying on fx as its something I can work out. Otherwise you are far more knowledgable on commercial than me. I have L2 , its not so clear in the day but in closing auction someone always puts a chunk in well below mid and the buyers determine where the auction will finish

[nickrl] 22/11/2021 19:12

hindsight thanks for properly analysing the FX effect i was 2nd guessing the difference in a hospital car park when i penned the response! Your analysis shows a lower FX effect than i was anticipating which could easily be neutralised by local currency valuations although be several months before know. Share volumes were unusually high at the start of this month but haven't been average levels over the last couple of weeks but price drops back. I don't have L2 to see if there is a constant seller. The CEO bought in 20k (232.7) and 13.6k (222.4)over the last six weeks so that didn't help.
Will it drop below 200 though.

[essentialinvestor] 22/11/2021 18:09

Underperformance re RGL is really stark
and you could make a case the CLI portfolio is of higher quality.

Covid mess in Germany is definitely weighing.

[hindsight] 22/11/2021 17:52

nickrl, yes fx one effect, but I made it a bit less ie 30th june 2021 0.8608, today 0.8397 so -2.45%. Then its 51% euro based. Presume debt is euro/£ balanced to assets so 40% gearing means -2.45/0.60*0.51 = -2.08%
EI, yes they are boxed in, if gearing was lower they could buyback and I would be lot keener to add
Imagine one could argue they should sell something and buyback some shares if thier NAV bears resemblence to clearing prices

[essentialinvestor] 22/11/2021 17:36

A problems with CLI switching from regular tender offers to dividends
is they perhaps lack the flexibility to reduce the share count at times like these.

If gearing was lower I suppose they could have conducted a buy back.

[nickrl] 22/11/2021 16:19

Hindsight agree and outside of logistics there doesn't seem to be any rational to why CLS is in the doldrums and RGL isn't other than the EU portfolio. So yes £ x € has moved about 9% since last results so will give NAV a knockback but only c6% and thats if there is no local currency appreciation. Same on income but maybe c5% but they do have additional income off recent German acquisition.
Divi still puts me off adding but the discount is getting silly so bound to be someone on the phone to the family.

[essentialinvestor] 22/11/2021 15:47

Sold out of Capco today and added a small amount here and to SLI.