F&c Commercial Property Investors - FCPT

F&c Commercial Property Investors - FCPT

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Stock Name Stock Symbol Market Stock Type
F&c Commercial Property Trust Limited FCPT London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
0.00 0.0% 121.20 01:00:00
Open Price Low Price High Price Close Price Previous Close
121.20 121.20
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Industry Sector

Top Investor Posts

skyship: Mark – sorry, but in your own interests I would challenge much of what you write. You seem to have some cursory knowledge of the sector, but the key word there is cursory! Perhaps follow the posts over on the CP+ thread; and over time you will both learn and profit. # Firstly – P. No.176: “Divvies have been steady over that three years; I don't care about valuation fluctuations as long as the income keeps rolling in…” Income and capital are two sides of the same coin. A good investment needs to preserve or enhance on both counts. If the capital erodes then should you need to access a specific sum of cash, patently you will have to sell far more of your investment than would otherwise be the case. Denying this fact is one of the most basic errors in the investment lexicon; and I would urge you to take that on board. # Secondly – P.No.189: “So it kind of feels like we are caught up in a general sector decline” Wrong, there is no general sector decline. Sure, over the past 3 Qtrs the global economy has stalled and property valuations have done likewise; stalled, but not declined to any measurable degree. Here in the UK the rank badly managed Brexit negotiations have sapped confidence from the market, so activity has markedly slowed. But underlying fundamentals remain positive and in the regions rents are still rising, except in most Retail. Once Brexit is resolved, then pent up demand for high yielding assets will once again reassert; and yield compression will again lift valuations. # Thirdly – P.No.189: “In my opinion the challenge from online is putting pressure on bricks and mortars retailers”. This is not your opinion – this is FACT. Certainly for the past two years it has been the most important driver affecting property portfolios. An excessive allocation to Retail (NB: NOT Retail Warehouse) in cases such as Intu, Hammerson & New River for instance, has had a profound effect upon valuations; and the dreaded CVA has become the nightmare stalking the text of Property Manager reports! # Fourthly – P.No.189: “…yield compression…” This is an important factor driving valuations, but you use the phrase incorrectly. YC arises from active property transactions (acquisitions) in a competitive market driving valuations up and corresponding yields down. With global interest rates again declining, it is perhaps surprising that well-tenanted, regional industrial & office properties can still provide yields of, say, 8.5%. If competitive bidding sustains a yield reduction to, say, 8.0%, then the underlying valuation will rise 6.25%. Now factor in an average LTV of 35%; and suddenly you’re looking at an NAV uplift of 9.0%. All on the back of simple YC. # Fifthly – P.No.189: “If I were looking for capital growth I'd avoid the property sector altogether.” Again Wrong; actually totally and manifestly WRONG!!! There is plenty of evidence that property investment outperforms equity investment. What you need to bear in mind is that property gain doesn’t come from YC alone. Propcos also gain from: # rent reviews # change of use # portfolio sales and reinvestment on higher yields # lease extensions (tenancy renewals on longer leases) # increased occupancy (lettings of empty space) # property refurb. # peripheral development # restricted development driving up local property rentals/values # & there are likely others I have omitted! Among other places, read P22 of this RGL Presentation: http://www.regionalreit.com/~/media/Files/R/Regional-Reit/investor-docs/results-and-presentations/regional-reit-interim-presentation-2018.pdf I’ve spent enough time on this, so will just end with one final homily: Never, ever buy a propco trading at a premium to NAV. FCPT did just that for far too long; and has cost many for that one reason alone.
markth: I see a number of things driving share price The first is that property isn't very liquid. When there's structural danger (Brexit) investors will pull their money out of less liquid sectors like property. Of course FCPT is closed end and a rush of redemptions doesn't make them a forced seller at depressed valuations like it would an open ended fund. So it kind of feels like we are caught up in a general sector decline. SLI which I also hold for income has been marked down quite a lot too along with FCPT. The second is mix. In my opinion the challenge from online is putting pressure on bricks and mortars retailers with many well known and long established names going under in recent times. To complete, the B&M guys have to cut costs which means reduced rents, which depresses valuations on retail property due to yield compression. FCPT knows this and is divesting retail as fast as it can, and moving money towards industrials which is doing quite well. The sectoral shift will come at the cost of a small dip to share price from selling out of retail when the price is low, but will increase yield by reinvesting in industrial. Finally there are some interesting (positive) tax angles from restructuring as a REIT. I don't really understand this very well but others say it will be accretive over the medium term. These views are biased of course as I am in this for income. If I were looking for capital growth I'd avoid the property sector altogether.
skyship: Darren - hate to disagree with a fellow property investor, however to my mind FCPT is a 100% SELL. # A 5.2% NAV PREMIUM! # A yield of just 4.1% # 12.7% of portfolio in Scotland - mostly in damaged Aberdeen # 33.7% of portfolio in London's West End - better than the City, but London values softening The stats and the chart (see link below) suggest very little upside; whilst clear downside. If you are set on having some property exposure (which I agree with) then strategically look for players with portfolios outside the over-valued London. The regions are still cheap - but avoid Scotland. Two to consider might be: # Palace Capital (PCA) @ 370p - 14% NAV discount; 5% Yield; great track record - see Investor Presentation http://palacecapitalplc.com/assets/files/InvestorsPresentation/FY17YearEndResults-June2017.pdf # Ediston (EPIC) @ 111p - One of the new high-yielding investment REITs - 1% NAV premium; 4.95% Yield; investment managers acknowledged as one of the very best in the field https://uk.advfn.com/p.php?pid=chartscreenshot&u=V6SxFuS9tuMKZxWoX7skPVzJCgB%2FUVxa&kslash=s
montyhedge: Will they continue to pay dividend? Or could they say we are preserving cash to pay out to investors who want to sell.
northernlass: Safe As Houses! BIAS TO PROPERTY IS SAFE AS HOUSES Strong performances in property have prompted investors to consider the asset class, particularly the commercial and residential British markets, which are well regulated and transparent. As the crisis in the eurozone looks set to rumble on, the appeal of safe havens has only grown in recent months. With many asset classes already looking expensive, property, once the darling of the investment community, may be due a revival. Richard Kirby, the director of property funds at F&C and the lead manager of the F&C Commercial Property trust (FCPT), says the sector has seen some strong performance in recent years. "We had very strong performance last year. The underlying properties delivered a top decile return, which has continued our top quartile performance over both three and five years," he says. Over five years the FCPT has lost 3.40% against an IT Property sector average fall of 35.48%. Moreover, the trust has returned more than 70% over the past three years, versus 51.28% from the sector. Kirby says the driving factor behind the recent success has been the trust's focus on prime British property. "We've seen rents and capital values under pressure. Under these conditions prime is holding up better than secondary, and London and the South East is doing better than the rest of the country," he says. "We have a significant weighting to central London and much lower exposure to the regions. Within that we have no exposure to shopping centres." One of the most interesting developments of recent years that has allowed central London to shrug off the sector's woes elsewhere is that buying has been dominated by foreign investors. Indeed the pricing is such that domestic buyers are finding it progressively difficult to compete with the strength and depth of overseas buyers. This disconnect helps explain how the trust has distanced itself from its peer group and perhaps suggests a reason for optimism despite ongoing macroeconomic concerns. Read the complete article here: http://www.fundweb.co.uk/fund-strategy/issues/7th-may-2012/bias-to-property-is-safe-as-houses/1050801.article P.S. Here's a couple of links about SCLP, one of the hottest stocks at the moment: http://www.euroinvestor.com/community/discussionthread.aspx?threadid=252803 http://www.euroinvestor.com/community/discussionthread.aspx?threadid=253089
pip_uk: Share price showing no setback at all. It seems bullet proof from the general run of commercial property companies share prices, but is it justified. Being no expert in commercial property, but eyeing the dividend being paid, what have you more informed investors got to say on this company. Regards. Pip.
skyship: Not Manu - firstly, DJAN - this used to be an old favourite of mine back in 2001/2 when it was @ a 45% NAV discount. However I became progressively disenchanted with the frankly corrupt dividend policy. The controlling family (80%) pay themselves enormous salaries to in effect manage their own pension funds; but therefore have little need of high or even "fair" dividends - so minority shareholders lose out. Seems to me as though they lose out by c.4%pa - that's 17% after just 4yrs of holding DJAN. With so many PICs or REITS to choose from, why buy DJAN? The key to the secure, lowly geared PICs (FCPT, IRP, UKCM) is the sustainability of the dividends as the investment case rests upon an assessment of both yield and asset values. The dividend payouts are effected by: Company policy, distributable reserves, fees & operating costs and banking covenant restrictions. Sure, in the cases above the revenues won't 100% cover the payouts, BUT, if the dividend level is the Company policy and there are cash balances to pay from revenues + reserves, then IMO the yield is a true figure - especially when reaffirmed. In the case of FCPT not only has it been reaffirmed, it has also been decided to pay the dividend monthly - a very handy benefit. As to sustainability in the event of long-term depression and increasing voids, well, everyone has to make up their own minds on that score. Every investor should have an opinion; but recognise that no-one knows for sure!
skyship: BUY FCPT @ 61p for a 9.8% Yield Over the period 2003-6, a number of Property Investment Companies were launched into the booming Commercial Property ("CP") market. They were structured and domiciled so as to be especially attractive for private investors seeking a good income. Some of them (the better ones) were spin-offs from the property portfolios of the Life Assurance companies. As the CP market collapsed, the sector as a whole has been a bit of a graveyard, especially those burdened by excess leverage. The actual or threat of banking covenant breaches pushed prices down to fractions of their underlying NAVs, but the apparent value can easily be destroyed if asset sales are impossible and financing has to be renegotiated on penal terms. So far actual banking foreclosures haven't materialised as the banks have placed more reliance on status quo interest cover than on asset cover. The sector represents a very interesting area for bargain hunting as the Market tends to lump all the companies into the same pot – regardless of individual circumstances. IMO the best three companies to trade/buy are the three with low gearing. The NAV discounts are all based upon 31 Dec'08 stats: COMPANY- DEBT- SP- DIVI YLD NAV DISC. UKCM – Zero debt 61p 5.25p 8.6% 13% FCPT – Net debt c.10% 61p 6.0p 9.8% 28% IRP – Net debt 38% 45p 7.2p 16.0% 44% It is the gearing and the terms of any debt that is the absolute key to successful investment in this sector, so I highly recommend reading through all the Interim Management Statements, Finals, Interims & NAV Updates – all of which will be on the relevant ADVFN thread or company website. UKCM: (Controlled by Ignis Asset – formerly Resolution) http://www.ignisasset.com/site FCPT: (Controlled by Friends Provident) www.fccpt.co.uk IRP: (formerly Isis Property Tst.) www.fandc.com Start off by reading this one from IRP today - & you'll see why there is value to be found and why one of the directors was buying for his three sons just last week. I was lucky enough to follow him in @ 37p having read of Director Purchases in the IC. http://www.advfn.com/p.php?pid=nmona&cb=1235731468&article=36435382&symbol=L%5EIRP I've recently sold my UKCM (also see an earlier thread on this MS site) as the NAV discount has closed to a mere 13% (was down to just 10% when they peaked @ 63p yesterday). I'll be a buyer again should they retrace to 55p. The one to buy today is FCPT. This one is controlled by Friends Provident. They recently confirmed their 6p/annum dividend, but henceforth to be paid monthly. At the once again attractive 61p (down c.5p over the past week), they yield a princely and secure 9.8%. They could trade lower into the mid 50's (as they did at the end of January), but if they did so then my advice would be to throw the kitchen sink at them – certainly double up; especially as their articles call for a bi-annual "Wind-up" vote – originally a device to limit the NAV discount. If this year's vote calls for dissolution, then there would be further unexpected upside – see link below: http://www.advfn.com/p.php?pid=nmona&cb=1235735827&article=36112169&symbol=L%5EFCPT Recent NAV Statement: http://www.advfn.com/p.php?pid=nmona&cb=1235741222&article=36008711&symbol=L%5EFCPT
not manu: chopshs - I did mean investors like JP and discount busters like Carousel Capital, Laxey Partners etc. Agree re reducing debt and buy backs but the management companies wouldn't like the lower management fees on the lower gross assets.
jonwig: Property trust shares must rise 10% in 22 days By Rob Mackinlay The UK's largest commercial property investment trust must see a 10% increase in share price in 22 days or management will have to call an EGM. The £917m F&C Commercial Property Trust, a FTSE 250 company, has seen no more than 0.25p or 0.2% price movement since making the announcement in its interim results this afternoon. In the report the trust's management reminds shareholders that its prospectus requires a share buy back if the share price falls more than five per cent below the published net asset value for 20 dealing days or more. It is also states that if the discount stays above 5% for 90 dealing days or more, the directors will convene an Extraordinary General Meeting to consider winding up the trust. The deadline is 22 August. The condition was written into the prospectus as a safety net for investors if the venture was failing. The current consensus is that the trust is performing well but some investors expect the EGM to boost share prices and narrow the current 15% discount. Daniel Lockyer, manager of Iimia's £25m income fund, says that Iimia as a whole has increased its stake in F&C Commercial Property Trust over the last six weeks. He says that the reason for the increase is the large discount but also the threat of an EGM which he believes will boost share prices. Lockyer points out that Friends Provident owns more than 50% of the commercial property trust, and that in the unlikely circumstance that shareholders vote to close the trust, there will be potential buyers for the whole portfolio. Paul Herrington managing director of F&C Property Asset Management, says that the clause was put in the prospectus to establish whether shareholders wanted the trust to carry on with business. He says that the scenario for which this clause was designed is not the current one: "At every one of the investor presentations we go to they are all very happy with what they have bought into." However he confirmed that the deadline for the EGM would be on 22 August with the meeting having to take place within three months. http://www.investegate.co.uk/invarticle.aspx?id=1068
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