Ediston Property Investm... Share Discussion Threads

[marktime1231] 25/8/2021 16:12

c. 23 July EPIC bought back two approx 4.9% and 3.9% holdings from Stadium at an unstated price, at about the time when the market share price stepped up from mid-high 60's to low-mid 70's based on a NAV/trading update.

c. 27 July EPIC placed an approx 6.4% stake with Thames River Capital, which may be the secondary placing at 67p described in today's announcement. As you say this is a slight discount to market price but a considerable discount to NAV.

If these two transactions roughly cancel each other out it will not be dilutive. Maybe it cost more to buy out Stadium than they raised with the Thames River placing, and/or they still have a couple of million shares to place or sell in the open market?

What do EPIC mean when they describe their own investment manager as having an intensive style? Adjusting the mix of portfolio assets for higher yield and refurbishing units to attract higher occupancy just seem like sensible good management practices to me.

[owenski] 25/8/2021 14:54

It was this was it not -

[skyship] 25/8/2021 14:18

hs - yes indeed - thnx for posting. That removal of the Stadium rump by TRY was an excellent move for one and all...

[hindsight] 25/8/2021 14:10

Sky, I just read it as, they brought the holding off a large seller in the market and was poorly drafted. Was more pointing out the sector comment

[skyship] 25/8/2021 13:52

Is this what they meant?

We acquired 6% of Ediston Property Investment Company (market cap of £160m) in a secondary placing at 67p (now 76p). The company is over 75% retail warehousing, with a strategy to move closer to 100%.

[skyship] 25/8/2021 13:50

Perhaps a poorly drafted statement by TRY....perhaps they were referring to the acquisition at 67p from Stadium.

[nickrl] 25/8/2021 13:49

Good to see Prestatyn finally reinvested although those units are a bit homeware heavy and never trust that lot not to launch a CVA at first sign of trouble. Need a BM Bargains in there and an Aldi/Lidl in the vacant units.

[skyship] 25/8/2021 13:48

"...in a secondary placing at 67p (now 76p)."

What the hell is all that about? Certainly hope not as it would be at a 23% discount to NAV - so highly dilutive for non-participants.

Pre-emptive rights and no RNS from the Company surely suggests that is total cobblers!

[hindsight] 25/8/2021 13:40

While we remain negative about the outlook for much of the retail sector, an exception is retail warehousing. The sub-sector has seen rents and values stabilise, with retailers attracted to the edge of town accessibility and general affordability as part of an omni-channel offering. We acquired 6% of Ediston Property Investment Company (market cap of £160m). The company is over 75% retail warehousing, with a strategy to move closer to 100% in a secondary placing at 67p (now 76p).

[alan pt] 25/8/2021 10:07

I might debate some of the political points, but it's not Twitter, so I'll just be happy with having acquired an excellent asset, close to Bannockburn :-)

[spectoacc] 25/8/2021 09:01

Nationalism trumps finance tho - "Look how strongly we feel, we don't even care about the money".

On any logical assessment, devolution gone too far already. SNP are inept. Private Eye been good on them.

Back on topic - no mention from EPIC on what the "planned upgrades" to the two vacant units will cost. But in the scheme of things, won't greatly matter, & our forthcoming divi increase now underpinned.

[hindsight] 25/8/2021 08:44

The SNP are going to have thier work cut out convincing people they can replace the 2k per person from the Barnett formula. The smoke screen of oil is now gone.

[spectoacc] 25/8/2021 08:03

No fair point. There's no legal ref without Boris's agreement tho, & fail to see how that would be forthcoming. But a different debate, relevant mainly to REITs regime & CT.

[gary1966] 25/8/2021 07:59

SpectoAcc,

I believe it has been agreed that there will be another referendum in the next 5yrs after the alliance with the Greens. Not sure it will have any effect on shopping or demand for retail warehouses though.

[playful] 25/8/2021 07:06

Terrific news this morning we will double our yield on those Tesco sale proceeds!

The acquisition was funded using the proceeds from the sale of the Tesco Superstore in Prestatyn, which was sold for a 5.2% yield. The net operating income from the new acquisition is 35% higher than the rent received from Tesco, and is therefore accretive to dividend cover.

Targeting a 10.8% yield!!

[spectoacc] 25/8/2021 07:05

Looks very good for our divi. Some may not be so keen on the Scotland focus, but there's no SNP super-majority, nor referendum, and as other have pointed out, EPIC is Edinburgh-based:


"Ediston Property Investment Company plc (LSE: EPIC) announces that it has acquired Springkerse Retail Park, Stirling, for £21.85 million, in an 'off market' transaction. The price reflects an initial yield of 9.54%. The retail park was purchased from clients of LaSalle Investment Management."

"The park is anchored by B&Q, with other tenants including Wren Kitchens, DFS, Pets at Home and Halfords represented on the site. The asset is expected to benefit from the intensive asset management style of the Investment Manager. The planned upgrades should improve the lettability of the two vacant units (13% by ERV), providing an opportunity to increase the income stream and drive capital value. On completion of the letting of these two vacant units, the yield is expected to rise to 10.8%."

[spectoacc] 24/8/2021 13:37

Will presumably still be a few generalists - SREI, SLI perhaps. Leaving:

Offices - RGL
Retail Parks - EPIC
Logistics warehouses - many, eg SHED for small, BBOX for large
etc

I think it works, if they don't all do it.

Interesting to see the runaway success of industrial vs dire state of Retail cause eg BREI to breach its 50% weighting limit.

[marktime1231] 24/8/2021 13:29

Which is perverse.

Previously diverse REITs polarising into narrow sectors, which means we have to invest in a basket of them in order to diversify our portfolios.

[spectoacc] 24/8/2021 13:14

All valid points @marktime, but have to say I've seen no bargains - on the contrary, pricing has seemed nuts.

High St - yes, reckon AEWU are looking to corner part of Bristol retail, & definitely wouldn't bet against them.

Offices I'd be least confident about, the most uncertain for recovery - and am a holder of EPIC, not buyer of RGL. RGL got a pretty good record tho.

Industrial just crazy atm, likely to remain so for a while, but if/when it tops out, it'll be too late to sell.

So can see rationale for all, concentrating their expertise, and wrong to knock WHR a few years ago when they were keen buyers of what others were offloading - their junk industrial done very well since.

So all winners - maybe :) No harm in having definite smaller REITs for office, Retail Park, Industrial etc.

[marktime1231] 24/8/2021 12:57

Interesting circulatory behaviour Spec. There is appeal in all real assets producing income. Which sector to concentrate on is a matter of conviction for the respective executive, but how can they all be right.

In some cases I think it is because the properties will deliver strong indexing rent to provide sustainable high yield. Can't see a revival in the high street though, and covid19 has shown it is attractive to work from home at least some of the time.

In others cases it might be because the assets are available at extreme discounts because the rent outlook is risky. The backstop to these contrarian plans might be converting high street retail and office properties to residential, retail park sheds to logistics or industrial. For example, the conversion of iconic centrally located waterside Debenhams stores to prime residential is realising value in those properties far in excess of their previous book/retail income value.

[chucko1] 24/8/2021 10:17

"ive taken a substantial chunk of those" - what, of the 10mn? How do you know the recent seller was also active a number of months ago?

[theprovosts] 24/8/2021 09:28

Interestingly enough, the seller inside the spread (often quite aggressive, with buys almost on the bid rather than closer to the offer) was pre the Stadium sale so unaffected by their exit. They seem to be easing off which isn't surprising considering how many they've sold over the last 6 months. I'd hazard a guess at somewhere near 10 million shares, ive taken a substantial chunk of those, and with NAV rising, and things calming down worldwide, i can see this trading in the 80's within 12 months. Very happy to be holding these longer term. GLA

[spectoacc] 24/8/2021 07:07

Had forgotten RGL was selling industrial to buy offices - perhaps a good sign for EPIC's office sales.

Curious REIT merry-go-round atm of EPIC buying Retail Park/selling offices, AEWU buying (Bristol) High St/selling industrial, RGL buying offices/selling industrial, most others looking to buy industrial...

At least a chance they're all going to be right.

[chucko1] 23/8/2021 15:30

Sky, absolutely nothing surprises me in the REITs sector. In particular large sellers wanting out for odd reasons. Let's help them by buying at low prices! Worked last time.

I have helped them the past 2 days on 5 occasions, and it's becoming a bit of a habit.

[skyship] 23/8/2021 15:09

Hi BT. A Good buy that. Personally surprised to see them retrace back to this level; but my 80p target still stands.

Though that likely won't be met until they confirm the likely 5.5p annual divi post the Sept'21 year end.