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[donald pond] 28/11/2022 08:57

I could never get my head around the sector but seem to recall that in general you buy a property for x, spend not very much making it fit for purpose and then, due to the generous rents paid on social housing, it gets valued at 2x. It all rests on the assumption those rents last forever because arguably a lot of the changes made to the property may detract from its long term value. I've not looked at HOME, as I said, I could never get comfortable with the whole sector

[loglorry1] 28/11/2022 08:55

Doesn't this just boil down to the alleged fraud being that small ltd companies were setup to buy very cheap housing which was sold on to HOME at a much higher price because HOME added long term rental contracts to these properties. These rental contracts justified the increased valuation here becuase on a DCF basis they justified a much higher valuation.

The bears say this uplift in value should have accrued to HOME shareholders. The bulls say so what as long as we get he cash flows as they come in which should be ok cos the rental contracts are long term (although the charities paying them are skint).

Is that pretty much the sum of it all here?

[williamcooper104] 28/11/2022 08:48

Fine to be bullish But tell us yields, values per sf - make it with arguments rather than just name call When you play the man not the ball you've lost the argument

[dodddy] 28/11/2022 08:35

>hedgehogster
you are blatant ramper with no regard to the facts.

your long, wrong and hurting.stop trying to talk other people into following your blind logic

[george stobbart] 28/11/2022 08:34

Why is this Ponzi scheme not trading at 25p? Any news on why this is so much overvalued?

[kimboy2] 28/11/2022 08:31

If those numbers are right then even at £60 per bed per night they are being valued on an annual yield of 5%.

[spectoacc] 28/11/2022 07:42

VR say many of these purchased portfolios have been upped in value in the HOME NAV calculation, post-purchase.

Picked at random 51 Eleventh St, Perterlee, SR8 4QQ. Part of the portfolio mentioned above.



That gives you a good impression of house prices on that street, and what the houses might fetch if allegations prove true. Last reported transactions no.11 for £29k, no.48 for £33k.

[spectoacc] 27/11/2022 20:47

@Williamscooper104 - to revisit a previous post:


"As an example, take the Peterlee portfolio on page 24. This portfolio is comprised of 10 houses and was purchased ...in November 2020 for £326k. AHG1 was incorporated in September 2020 (alongside dozens of other companies with similar names..). HOME IPO'd in October 2020 and a year later purchase(d) the Peterlee portfolio from AHG1 for £848k. So AHG1 made a realised gain of £522k on 10 properties in the space of 12 months..".


Manifestly, that increase in value can only have come about due to the tenancies - if you know Peterlee, you'll know £326k for 10 houses isn't far off.

So are the tenants kosher - ie are the charities legit. And who ultimately pocketed that uplift, one of many.

The two directors of AHG1 are Keith Gilbert (35 appointments) & Anthony Simon Abrams (15 appointments). That may be nothing, but many are similar co's doing very similar things. That's a lot of money, with all the alleged overvaluation being stumped up in cash by HOME.

[williamcooper104] 27/11/2022 20:30

Remember the properties were bought at 5.9 when genuine long leases to solid covenants were at 4.5 - so there's already a c25% discount for weak covenants - whether it's enough ofc we don't yet know

[spectoacc] 27/11/2022 20:26

Bear in mind KnightFrank are quoted as not having been in any one of the properties, due to the nature of the tenancies. So it's been a desktop valuation for the HOME NAV.

My guess is - same for the bank valuers. But I say that without knowing.

[williamcooper104] 27/11/2022 20:26

The lender is Scottish Widows, so will be underwritten by Lloyds's CRE team, who are notoriously conservative and who do not short cut dd They will have VP and alternative use values; but on an LTV of 25-30 with a covenant on 50 (they always were a nightmare on covenants even in 2006) their position looks pretty solid; especially right now where they've basically got most of the cash on the balance sheet and could use that to pay down their loan; so worst, worst case - very hard to see them taking a credit loss Of course a covenant breach, eg qualified accounts or such, and widows could reprice their debt

[williamcooper104] 27/11/2022 19:54

Looking forward to hearing how your Peterlee tour goes I'll bet no one from M&G has done that

[williamcooper104] 27/11/2022 19:52

Dawson has literally no balance sheet £8.5k of assets and £8.5k of liabilities Doesn't look like a holdco of a more substantial entity - but I might be missing something If I'm not - then it's alarming

[spectoacc] 27/11/2022 19:48

@Kimboy2 - plenty on posts above, search for @74tom's posts for eg. I'll be visiting a couple of the Peterlee ones this week.


"@hedgehogster27 Nov '22 - 16:04 - 218 of 232
0 14 0
“Follow the money”, you mean like Liontrust and M&G who have increased their holdings to a combined 17% of the value of the business in recent days? There are two sides to every story and I fail to believe that this is clearcut, the report was generated by a shorter who profits from the fall in the share price provoked by their unsubstantiated allegations which the BOD were happy to dismiss immediately via RNS the day following."


I absolutely have no faith whatsoever in Liontrust, M&G, or for that matter Schroders or any of the others. It isn't their money, and every scandal/scam/fraud has all of the big institutions on the register when it breaks.

As for them adding more - my guess is they've done naff-all DD. Absolutely naff-all. Perhaps been at school with some of the HOME directors and been assured all is fine.

Agree some of VR's report is bunkum - in particular, the "paid £Xm for a property that was valued at a few hundred k previously". The £Xm is a Land Reg quirk when a group of properties are acquired together. Order some of the titles on Land Reg - costs all of £3, can get them instantly.

The remarkable thing about this scandal (too early to call it that?) is how easily anyone sitting at their computer can check it. Some really good posts on this thread doing just that.

By "Follow the money" I mean have a look at the so-called charities supposedly running the businesses that rent the co's (as @kimboy2 has done above), & more pertinently, find the connection between the co that puts together the portfolios which are sold on to HOME at vast mark-up (based, of course, on the leases granted to the supposedly unconnected charities).

That's where the money is leaving HOME - figuratively & literally.

There are some very large govnt and/or Lottery grants going to some of these charities.

[williamcooper104] 27/11/2022 19:48

Lotus looks like it only really got going in 2021 "Strong track record" - hmm

[kimboy2] 27/11/2022 19:17

I know very little about HOME but was attracted by the fuss to see if there was an opportunity. I looked at the last AR as a starter and read this;

The Group undertakes thorough due diligence before
acquisition and acquires assets let to strong tenants with
track records in servicing the sector giving confidence that
they will be able to pay the rents as and when they are due.

Jolly good.

I then saw that their leading tenant was Lotus Sanctuary CIC with 12% of contracted rent. Their results are;



The second on the list is Dawson Housing Ltd with 9.5% of contracted rent.



Both companies have been going a couple of years, which hardly seems consistent with 'strong tenants with track records...'.

Perhaps I am missing something, but this has a strong smell of at best cronyism to me.

Anyway, I will be interested in the explanations.

It would be nice to know the actual addresses of the properties so I can see what they are actually worth. Is there a list somewhere?

[williamcooper104] 27/11/2022 18:25

Nope - actually sold out before I knew there was a short report; and well before I'd read it HOMEs shares tanked; CSH and SOHO didn't - so I exited I always know before I buy any position what my min and max stop loss is; and I ruthlessly stick to that - you see - that takes emotion out and means you're never ever left as the bag holder All you really need to do is manage risk; markets will take care of your upside

[hedgehogster] 27/11/2022 18:23

That wasn't addressed to you, but to someone that consistently posts that this is a "Ponzi scheme" which any intelligent person would know is grounds for libel without proof? Anyway I have no interest in exchanging with you, goodbye.

[williamcooper104] 27/11/2022 18:12

A very small starter position at a small loss; which would now be a bigger small loss - that's got zero influence on what I think nowI was tempered to jump back in - you'll see i pointed out the 11 percent cash on cash when fully deployed at current share price The EPC status (which wasn't raised by viceroy) held me back - hence why I say this has been one of the best value add threads I've read on ADFVN That might change; might not - I have an open mind; unlike someOne thing I'd say - risk manage your position and never take a 90 loss

[george stobbart] 27/11/2022 17:32

Whoever buys shares in this scam is an associate to the Ponzi scheme

[hedgehogster] 27/11/2022 17:23

Until we see the rebuttal report from the company there is zero evidence that any of these claims are true, you admitted to having sold out the other day at a loss so can fully understand your biased perception of events. There is no conclusive evidence at present to prove anything that has been alleged.