Home Reit Share Discussion Threads

[spectoacc] 20/2/2023 17:06

Bet no more than a handful could attend, and bet no questions of any import were answered.

Questions like:
"Why did you repeatedly deny all of VR's allegations, only to confirm them now".
"Why did you deny knowledge of the whistleblower allegations when they were allegedly made prior to your RNS".
"Why did you twice say that 100% of rent was being collected, when it wasn't - or at least, was subject to deals on future rent-frees to cover CapEx, and wasn't being collected at the time of the RNS's."
"How's the external fraud investigation going. How is the internal fraud investigation going, and why is it already 7 weeks in."
"When are the accounts being released. Are the accounts being released?".
"Why have Knight Frank said absolutely nothing".
"What is the relationship between the 31-yr-old Alvarium have appointed, at their own expense, to review the properties/leases, and Alvarium themselves".
"Why do you leave it to CityAM to break the latest HOME news".
"Are you seriously telling us a cash offer has been made by a single-director co, with £1 on the balance sheet at last accounts, and why do you regard it as credible. Have you seen funding, and who is that funding from" [As if we didn't know].
"Has rent collection slipped further from 77% uncollected".

Etc etc.

[williamcooper104] 20/2/2023 16:56

Alas I wasn't able to my accounts a little complicated so the letter of rep ny broker produced wasn't accepted and they didn't turn around the required one in time - though HOME were IMO being difficult/nit picking

[tradez4dayz] 20/2/2023 16:43

Wcooper104 didn't you go to the AGM?I assume it was a bit of a non event

[spectoacc] 20/2/2023 13:08

Christopher Downing certainly seems an interesting guy, and if/when HOME comes to be liquidated, there could be a lot to learn from the ongoing administration of Mr Downing's co MIG Asset Management Ltd.



("Progress report", scroll down, particularly Part 3 & the various offers received for the properties that have failed to go through; the court case to gain VP which the administrators won, but the tenants haven't abided by; the presence of Noble Tree & Big Help as the tenants).

This is Mr Downing as property owner, rather than as SPV flipper to HOME, but it's very relevant.

As @CC2014 says above, it's a quick Google & Companies House job to peer behind the names.

[cc2014] 20/2/2023 09:04

"From Liam an earlier post



The Vendor/aggregator mentioned in the article(Karla Asset Management/Christopher Downing) made just under £11m of profit in one year and took £10.5m in dividends. Based on Home's RNS in November, developer margins are between 18-30%. This would mean Home purchased between £30m-£60m of properties from Karla Asset Management alone in one year. Surely not? The true developer margins must be much higher than 18-30%. Probably closer to 50-60% but it is almost impossible to verify and all of the profit/cash is taken out of the middle companies anyway. How many developers/aggregators are there? Christopher Downing has multiple companies doing similar things and he is just one aggregator for Home."


I did just a few minutes research on Christoper Downing and Karla Asset Management and his associates will provide a maze of things to invest if you had the time or inclination.

David Kingsnorth a fellow director at Klara was CFO at Ford Stellar Morris, a £300m? quoted property company which went bust in the 90's.

[spectoacc] 20/2/2023 07:33

Doubt they'll be saying much, but did anyone manage to get a dial-in to the HOME AGM today?


"Whilst the Board will endeavour to be as open as possible at the forthcoming AGM, there will be a limit to what it can say due to ongoing investigations."

[williamcooper104] 18/2/2023 21:12

And the standard HOME contract was that the properties were finished to EPC C So they totally knew that that hadn't happened when they told the market that it had

[spectoacc] 18/2/2023 19:48

"SpectoAcc - 27 Nov 2022 - 19:48:54 - 234 of 687

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."


Rare to see a more aptly-named poster than @wallywoo.

M&G's averaging-down not gone so well so far, but heck - maybe @wally's 60p bid comes to pass. LOL.


CityAM have been on the ball with HOME, & this jumped out from @Liam's link above:

"In a letter to Home REIT, seen by City A.M., the whistleblower raised major concerns over the state of some properties and said the provision of care to vulnerable groups by some of Home REIT’s CIC tenants had effectively broken down.
“Some of your tenants are in slum conditions, some without basic services, i.e. no heating, no hot water, damp, water ingress, poor roofs and lack of basic maintenance carried out,” the letter said."


"So far, Home REIT said it has only inspected 67 per cent of its portfolio as part of a wider property audit."


"A contract for one portfolio of properties between Karla Asset Management....and Home REIT....states that the seller of the properties should refurbish them “at its own cost and expense” to a standard that would achieve an energy performance certificate rating of C."


Comes back to the EPC research done way above (by @74tom from memory) which shows in publicly-available information that this largely wasn't done. The HOME directors could have easily looked this up too.

[sunshine today] 18/2/2023 14:16

Institutions are generally extremely poor at making investments, on behalf of others.

Research in todays FT shows 63% of fund managers underperformed their benchmark in 2022.

Over the last 100 odd years they have only averaged 6.7% a year.

[williamcooper104] 17/2/2023 17:08

LGEM is suing Glencore for fraud on behalf of its investors So would hope to see same here

[1tx] 17/2/2023 16:50

M&G don't beneficially own any shares in HOME they have spent circa £100 million of their clients funds on HOME shares which are invested in various M&G investment funds.It is their clients that stand to make a substantial loss here,not M&G.This is the interesting part of the HOME affair namely to date the total silence of the institutions who have put approaching a billion pounds of other peoples money into what appears to be a major fraud.I am not suggesting that M&G and other pension and fund managers who hold shares here bought with clients money are part of the scam or had prior knowledge of the "goings on" but they have a duty to their fund holders to ensure that the affairs here are bought to attention of the appropriate legal & regulatory authorities.

[wallywoo] 17/2/2023 14:45

They cannot trade a share that is suspended. Since the share price was never lower than 35p, we have a very easy estimate what price they were traded at. Any institutional short covering would also have to be disclosed in their rns. I have never seen huge buying just before administration, sometimes funds don't sell but i have never seen huge buying.


What a silly thing to post!!!


Almost like you are trying desperately to sound negative about huge institutional buying!!! They were nearly all buying despite the so called fraud being clearly in the public domain.

[williamcooper104] 17/2/2023 14:43

Every single stock I've shorted before it went bust had long investors saying exactly the same thing Don't forget this is now obviously a fraud - so even if you think M&G are investment geniuses (they specifically are not) they made their investment decisions based on false information We have a habit of usually believing what a company tell us

[murray_paul] 17/2/2023 14:41

> That is all recent buying

At what price?

For every seller there is a buyer.

Are they trading at 40p, or are they trading at 4p?

We have no idea.

[wallywoo] 17/2/2023 14:07

The discrediting and ridiculous trolling here is silly and pointless.


Do the posters really believe companies like m&g will allow their £100m + investment here drop to nothing?? They have added since their last Nov rns (when they also added).


Nearly every holdings rns is posting a higher institutional ownership than previously reported. Before silly derampers point out that a company needs to own 5% before notification, that is not true. FT, Morningstar etc report detailed investment holdings here. And the large funds have all been adding, except for 1 (Rathbone).


That is all recent buying. The idiots on here can continue to think the shares are worth nothing. But I would rather follow the millions controlled by funds, than the paid trolls on here. This will get sorted and anyone who bgt under 40p will be sitting pretty.

[williamcooper104] 17/2/2023 12:52

Good point The nicking could have happened at either the developer/flipper level or at the SPV charity level No question that HOME should fund refurb works and sue latter (to extent it can recover of course from an SPV) Cannot be taking potential Greenfell type risks

[liam_] 17/2/2023 10:53

hxxps://www.cityam.com/home-reit-was-warned-of-slum-conditions-in-october-in-row-between-tenants-and-property-vendor/

The Vendor/aggregator mentioned in the article(Karla Asset Management/Christopher Downing) made just under £11m of profit in one year and took £10.5m in dividends. Based on Home's RNS in November, developer margins are between 18-30%. This would mean Home purchased between £30m-£60m of properties from Karla Asset Management alone in one year. Surely not? The true developer margins must be much higher than 18-30%. Probably closer to 50-60% but it is almost impossible to verify and all of the profit/cash is taken out of the middle companies anyway. How many developers/aggregators are there? Christopher Downing has multiple companies doing similar things and he is just one aggregator for Home.

[wskill] 17/2/2023 09:56

Very true Little Beaker mission accomplished here for those who made the cash disappear ,this takeover is just a smokescreen giving them time to cover their tracks.
Theft of shareholders cash and assets is not a crime in the UK with the disgraceful Fundamentally Complicit Authority in charge.
But this is how the powers that be want the UK stockmarket run it is too dangerous investing in the UK as nobody ever gets jailed for stealing shareholders funds,I now only have less than 20% here mostly in funds and investment trusts.

[cc2014] 17/2/2023 09:30

I have read last night RNS over and over.

And it kind of isn't presented as it should be, at least it's a bit unusual, or not the usual style of these things I've seen before or maybe I'm just seeing things that aren't there.

This is a response issued by Bluestar to Home REIT's RNS and doesn't start with an introductory paragraph from HOME explaining they have decided to share Bluestar's reponse for the benefit of transparency for shareholders.

It reads more like Bluestar have decided to use HOME's RNS feed for their own benefit. Maybe I'm pushing that too far. Maybe the Board are just so out of their depth they've just sent it off without realising it's normal to put some words round it.

Further enquiries do not go to HOME but to Bluestar's financial advisor which is NUMIS. And nowhere does it say who is responsible for release of the RNS. It isn't FTI Consulting as it was with the previous HOME RNS.


Anyway non-binding indicative cash offer whatever that means these days. It used to mean broadly an amount of cash but these days it can mean anything.

[little beaker] 17/2/2023 08:58

Some... Er... Entertaining comments by wally here.

My view is a 0p takeover with no one going to prison. Mission accomplished. We aren't the US, luckily for the board and the advisors.

No idea why people are under the impression that investors will get fair value (even if there is any) in the takeover given the form of all parties.

[spectoacc] 17/2/2023 07:25

@Wc104 - Boatman, that's them. They've been on both sides of the trade so I'd be really interested in what they think now. Like us, they can't have realised quite how bad things actually were.

[spectoacc] 17/2/2023 07:06

There's also possibly £10m in solicitor escrow to go towards the "£15-20m" of maintenance backlog - tho I fear that number is going to be much higher. There's a reason only 23% of lessees are paying (or put more starkly - 77% of "loans" are non-performing).

@nexusltd - HL has gross gearing at 126%, hence my belief debt was higher.

Again, I don't see Blue(sky) as remotely credible, particularly not if it's with alleged Alvarium cash, since Alvarium are going to get sued to hell. So comes down to the value of the assets - HMOs with many lessees seemingly unable to claim exempt housing benefit, and with significant maintenance backlogs.

There'll be a market for the properties as a whole - & much cheaper buying HOME than paying stamp duty - but no rational buyer is going to want to pay anywhere near what they're worth. And what they're worth isn't what HOME paid, and isn't even what the original SPVs paid.

Depends how many look like the pictures in The Guardian article, but the starting point is what the SPVs originally paid, and mark down from there, less debt & deterioration & the rise in interest rates.

10p, +/-10p would be my guess.

Edit - could equally argue that if 23% of tenants are OK, that covers 12% of HOME's reported NAV (being the twice overpayment), & then assess the value to a bidder of the 77% that are uncertain on top, less the debt to Scottish Widows. It needs liquidating if there's no credible buyer for the whole.

[williamcooper104] 16/2/2023 23:05

Yep - net debt is low There's a chunk of, from memory, blocked cash that will remain blocked but could be used to redeem debt

[nexusltd] 16/2/2023 22:59

@SpectoAcc. The amount of debt is important. I've checked through the acquisitions again & it’s actually lower than my initial pass @ GBP901.1mn. If we allow 1% issue costs 853-8.5= GBP844.5mn net equity raise. Debt is thus GBP56.6mn. Why do you think otherwise?

Acquisitions from RNS’s
13/09/2022 57.4
05/08/2022 85.1
04/07/2022 92.3
05/05/2022 42.4
25/01/2022 55.1
17/12/2021 60.2
11/11/2021 62.6
18/10/2021 166.4
03/06/2021 47.1
08/03/2021 48.1
25/01/2021 69.5
14/12/2020 64.3
16/11/2020 41.6
19/10/2020 9.0

[williamcooper104] 16/2/2023 21:13

Was in Boatman Capital? My guess is that they'll try to offer something around the pre-suspension price, perhaps a little more on basis that there's no suey suey of Alverium - if that's possible