F&c Commercial Property Share Discussion Threads

[skyship] 27/2/2009 16:18

Hi ISA - well - we both had a great trade out of this at the start of the month - seems an age ago! Personally I think the 60p level could hold; but if it doesn't I'll happily add at lower levels.

What do you think about the Continuation Vote? Quite possible of course that institutions would welcome an orderly liquidation or any other form of wind-up/sell-off that gives us a value nearer NAV. If you allow for another 10% portfolio fall then the NAV would still be c.77.5p. Certainly adds another bull-point to the stock.

[isa23] 27/2/2009 14:14

I think it is a bit too early. I'd buy around 55p

[skyship] 27/2/2009 13:59

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)

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.



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:



Recent NAV Statement:

[isa23] 05/2/2009 10:18

SKYSHIP, my pleasure. Normally what I tip as bargains don't quite work out that way, so this was a BIG exception. I should thank my lucky stars. Had lots of luck so far this year with dgre & cpt!!!

[badtime] 04/2/2009 19:20

sky ..looked at LSP?

[skyship] 04/2/2009 16:46

ISA - thnx again - you may have seen I also posted my thnx on the UKCM thread.

Likewise thought I was in for longer than actually transpired; but in these straitened times it surely has to be right to snipe a quick 10% when on offer.

I'm sure we'll have the chance to get back in again & if not, well, it would indicate better markets and perhaps profits afoot elsewhere.

[isa23] 04/2/2009 15:42

me too!! in at 56.65, out @ 64.35... couldn't resist the quick profit (plus the divi). as usual kidding myself that I'm investing 'for the long term'

[skyship] 04/2/2009 15:06

Sleepy - will take a look - but I bt for the restated dividend + NAV discount - & unfortunately (or fortunately) have already taken the quick 10%!!!

[sleepy] 03/2/2009 16:43

SKYSHIP - what do you think the FCPT recurring earnings (ie rents less costs less net interest)per share are?

[skyship] 03/2/2009 16:23

Bt in in three tranches averaging 56.25p. Looks to me to be a great portfolio pillar - just like UKCM - a great yield and sufficient NAV discount not to worry about further valuation falls, esp. with just 5% net gearing.

[badtime] 24/9/2008 10:04

drifting down again

[washbrook] 22/8/2008 08:48

-31% latest

-25% average

-10% lowest

-37% highest

-.91 Z score

76.5p share price

111p nav

[washbrook] 19/8/2008 11:23

NAV
-28% latest

-25% average

-10% lowest

-37% highest

-.11 Z score

79.5p

Ex-Dividend Date - 24 September 2008

Record Date - 26 September 2008

Payment Date - 24 October 2008


108p nav

[cerrito] 15/8/2008 14:19

I was one of those who sold out today..too bad not one of those who did it at 8 sharp...just too much negative news this week but I guess I will be back.

[cerrito] 14/8/2008 20:49

a propos of nothing very much one thing that interested me in their interims was to see the amount of hedge funds/fund managers that they have taken on as tenants for their offices; hedge fund industry obviously still alive..hope they will be good tenants and FCPT have sufficient security from them.

[badtime] 12/8/2008 19:16

thts a bit btr

[not manu] 09/8/2008 00:10

A decent set of interims in the current circumstances.

Did notice that their office portfolio underperformed the IPD UK Monthly Index by c5% points. Also, some pressure on the income account in the period due to higher property costs.

LTV of around 9% and a discount to NAV of nearly 30% is pretty decent value. Though still not tempted just yet. lol

[badtime] 07/8/2008 23:02

I'd settle for those results at current time...carry on

[nickcduk] 07/8/2008 22:42

Results were in line. They have low gearing. They should start buying back shares aggressively in the open market and supporting the share price like IFD have.

[nickcduk] 06/8/2008 19:45

Results were due today. Not sure what happened to them. Market hasn't really appreciate the company is almost debt free following their recent disposal. Company should undertake a large share buyback with the recent sale proceeds. A continuation vote will be needed soon on the anniversary of the last EGM. Hopefully they will come up with something to get the share price moving. Pairs trade not really working out well with short UKCM but it will move the right way in due course.

[badtime] 06/8/2008 19:24

nibbled at 75..shud hav waited a tad...but hey ho...seems to b a bit of juggling at the mo

[rcturner2] 06/8/2008 08:07

I bought some of these at 76p this morning. I like the numbers.

[badtime] 05/8/2008 09:58

anyone know current yield..and company intentions over div? ..thanks in advance