Ground Rents Income Investors - GRIO

Ground Rents Income Investors - GRIO

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Stock Name Stock Symbol Market Stock Type
Ground Rents Income Fund Plc GRIO London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
1.50 2.78% 55.50 08:00:03
Open Price Low Price High Price Close Price Previous Close
55.25 55.25 55.50 54.00
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spectoacc: Investor Report a fortnight ago made for pretty grim reading too - with not much more detail on the legal case: hTTp://
sikhthetech: Leasehold rip-offs: Nationwide Building Society is among big investors that benefit Nationwide's own Pension fund invest in Ground Rents... "But now it has emerged Nationwide’s “final salary” pension plan, which to closed to new staff in 2007, invests in grounds rents. According to the fund’s 2016 annual report, its “ground rent property” assets are worth £54m. A spokesman for the would not reveal what proportion of these investments were in escalating ground rents. They would only say the “vast majority” of the fund’s holdings complied with the new policy."
jonwig: OK - he seems to want to hit BtL investors hard (Say, compulsory ability of tenants to purchase their rented property at a discount). That includes institutions. Therefore demand for build-to-rent dries up. Therefore supply dries up. But he wants to build 500,000 homes per year. That's the Labour message: say something great in one line, which takes maybe five lines to refute. Folks have stopped listening. Sorry about the rant - normally I try to avoid such things! Anyway, enough Labour MPs would block such policies even if we had a Lab gov't.
jonwig: Yes, I just read that. The latest factsheet shows that doubling GRs are 13% of the portfolio: Http:// I suspect that the immediate effect will be to reduce capital values (Ladywell Point Manchester, for example). It will be interesting to see whether contracts will be rewritten rather than being stuck with dubious assets. There's a good summary here of the whole leasehold property market: Https://
jonwig: Investor report for September: Http:// They point out that 10yr doubling = 7.2%pa. I calculate 25yr doubling = 2.8%pa. The top five assets have a blended yield of over 3%. If they're going to gear up as suggested, the best way might be a £25m 30-yr fixed rate bond yielding below 2.5%. I think they'd get plenty of institutional support for that. Unfortunately a retail bond is pretty unlikely.
jonwig: Fundraising has been mooted more than once. This new share price premium gives them an ideal opportunity to raise new equity somewhere between 119p and 128p depending on investor enthusiasm.
jonwig: Loldemort - sorry, I missed your last post. Valid points, I think, but we could all argue over what is *real* inflation: and the rates used by property companies needn't be either RPI or CPI. What is more concerning, perhaps, is this from the March factsheet: In the coming quarter we expect that there will be continued institutional investor competition for large portfolios, which will, consequently, put further downward pressure on yields, and that the rest of the market will remain stable but very competitive. The company will maintain dialogue with shareholders to manage expectations of the company's performance... which has a pretty clear meaning!
jonwig: Ground rents have gained in popularity in recent years as investors continue to search for assets that provide strong and secure income streams. More: Http://
davebowler: c.60% of ground rents they own have a link to RPI
jonwig: Dated 2009: Ground Rent Investment Yields Graph 7 shows the performance of ground rent investments over the past 10 years. The analysis splits those interests having between 80 and 125 years to run from those that have terms of 800 years or more unexpired. Yields from ground rents in the former category have remained fairly steady over the period. However, from a low of 5.08% in 2006, average yields in the 80 to 125 year market have moved out latterly to 7.23% in 2009. There has however been a more prevalent reaction to the recession in the 800+ year unexpired market with a notable fall in average yields from a peak of 6.36% in 2007 to 4.33% so far in 2009. This arguably reflects investors' preference for long term secure income in times of turbulence and identifies longer term ground rents as the only area in the residential investment market to show a rise in values over the last two years of economic uncertainty. I'd think commercial yields a bit lower, in general.
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