Home Reit Share Discussion Threads

[spectoacc] 08/1/2024 07:08

Monthly update as grim reading as always.

"Rent collection including arrears representing 12% of rent invoiced during the month."

Including the Mears portfolios?? Strewth. Actual rent collection, ie of the old portfolio, must be next to nothing. They're not doing nearly enough to recover arrears from the fraudsters IMO.

[spectoacc] 02/1/2024 12:22

The fine would be on shareholders so agreed.

Former Alvarium in particular.

[flyer61] 02/1/2024 09:04

Not bothered about the fine Spec...want to see the directors made an example of.

No holding.

[spectoacc] 02/1/2024 08:50

Thanks @nexusltd, more behind it than my long-held "10-20p", but interesting it comes out in same range.

Feel the Mears portfolio deserves a reasonable rating - they'll be good on maintenance/payments, ie a decent tenant.

The eventual FCA fine needs factoring in too, albeit not remotely imminent. Takes them years.

[gpvxxx] 02/1/2024 08:41

@nexusltd: thanks for the data and calculations. I'm just not sure whether you shouldn't have annualized and then discounted cash flows to yield a DCF. With i ~ 7% and monthly CF of ~ 600k this would yield a NAV of roughly 100m or 13.7p. Applying your proposed reduuction of 45% then results in relisting price of 6p.
Still high enough for such a scam.

[nexusltd] 29/12/2023 22:47

A finger-in-the-air share price estimate when it re-lists.

The data as provided on 30/09/23:
Number of issued shares: 790,570,465
Gross Asset Value: 412,900,000
Term Loans: (216,200,000)
Cash in hand: 14,000,000

Guesstimates:
Expenses: AEW fees, advisors etc.: (600,000/mnth)
Interest on term loans (2%p.a.): (360,000/mnth)
Interest on term loans (7%p.a.): 1,200,000/mnth)
Rental income: 600,000/mnth

Net cash flow to 30th November: c. (360,000 /mnth)
Net cash flow from 1st December: c. (1,200,000 /mnth)

Evaluation for a potential January 2024 relisting:
NAV = 412.9mn-216.2mn+14mn-(2*0.36mn+1*1.2mn) =208.8mn
NAV/sh = 26.4p

AEW is a well-respected manager, with experience in dealing with cigarette butt assets, limiting the discount to NAV. Guess discount c. 45%, relisting @ 14.5p/share.

[williamcooper104] 21/12/2023 18:27

Yeah - I wouldn't like to be in their shoes Good reminder why being a non-exec isn't worth the risk

[flyer61] 21/12/2023 18:04

WC look forward to them explaining to the insurers why they need to claim…

[williamcooper104] 21/12/2023 15:23

That'll be covered by their D&O cover

[flyer61] 21/12/2023 15:06

And given the board are probably in need of significant legal advice no wonder they haven't fallen on their sword. Someone has to pay for it all and it won't be them.

[williamcooper104] 21/12/2023 14:37

They can't prevent outright fraud It's more a question of what's done after to hold those responsible to accountUnfortunately the ambulance chasers are the only ones doing anything about it The board are hopelessly conflicted on litigation

[cousinit] 21/12/2023 14:11

What more could you ask of the FCA? I'm sure the KID detailed all the risks clearly for retail investors...

[triskelion] 21/12/2023 14:04

"But what’s it say about the board and Alvarium?"

Also what does it say about e.g. the FCA? They seem to have resources to consult and possibly implement codices of "positive discrimination" (Orwellian) policies, but do they have the resources to liaise with investigators of possible misfeasance?

[spectoacc] 21/12/2023 06:57

Excellent article. Perfectly sums up everything we've been saying for so long.

I'd emphasise a little more the fact HOME paid double or more the price for property bought sometimes only weeks earlier; that some of the bad actors existed stage left early on, claiming eg ill health; and the 12 months rent that was gifted out of capital to the fake-o CIC's.

Otherwise, essential reading on the scandal.

10-20p, depending on the Capex to keep the properties that remain liveable.

[triskelion] 20/12/2023 18:24

hxxps://www.cityam.com/home-reit-investors-move-to-sue-the-firm-after-portfolio-craters-in-value/

[catabrit] 20/12/2023 09:18

The scale of gross incompetence and misconduct here baffles me. And I just love that the whole short thesis was laid out in investors chronicle. Amazing.

[spectoacc] 20/12/2023 08:06

That Peterlee one noted above got pulled.

I was looking at Lot 263, 88 Garnett Road, £170k Guide. Sold for a gutsy £635k. Great for HOME, right?

Er, no - I reckon they paid over £1.9m for it. For a property in Hunslett, ffs.

Lynne is shocked, shocked I tells ya.

If the Board aren't the custodians of shareholders money, who is?


Edit - what really irks is them making themselves out as victims, the wool pulled over their eyes by Alvarium. Yet when VR's report came out, they roundly & repeatedly rubbished it, when 10 minutes on Google would have proved eg the silly prices, lack of CapEx, PSR tenants, ropey CICs, dodgy geezers behind the same CICs.

Or 5 minutes reading posts on here (that weren't @wallywoo's).

[williamcooper104] 20/12/2023 07:52

Note the board are "reserving rights" if now isn't the time for letters before action then when is Time to get litigating

[flyer61] 20/12/2023 07:47

Was offered Oriel Crescent Scarborough post auction yesterday. The capEx required to sort it out will run to 10's of thousands. All professional investors in the area had given it a good looking over and what seems a bargain price is actually a heap of trouble.

Going to take years for HOME to get sorted....plenty of time for all 'advisors' to clean up and the board to scamper at a convenient time.

[flyer61] 20/12/2023 07:43

Would you trust these people with ANY capital. They are serial destroyers of it.

[spectoacc] 20/12/2023 07:12

A release just before Xmas, bound to be good news, right?

First point:
"Following the substantial completion by JLL of external inspections of 2,391 properties, comprising 97 per cent. of the Company's property portfolio, in addition to 195 internal inspections..."

They've been in 195 properties, 3%. Do you trust this valuation?


"...The August 2023 valuation representing 42.26% of the unaudited historical acquisition costs of £977.0m (excluding purchase costs). "

As per auction prices they're getting, that's ballpark - will be less than 42% in NAV terms.


"Initial evidence from AEW's ongoing asset management initiatives indicates a larger than expected proportion of the portfolio is private rented sector ("PRS").."

Or - they could have just read VR's short report.


"Accordingly, the Company is not in a position to publish an estimated net asset value at this time. The Board and AEW are committed to continuing to work at pace with BDO to publish the audited results in a timely manner. "

No re-listing imminent.


Sounds like CapEx is going to be very large on what they manage to keep too.
"This has resulted in many properties found to be in need of extensive renovation before they can be occupied or properties that may need to be reconfigured to provide an appropriate number of rooms to suit the local market."


Don't worry though, Lynne Fennah has some soothing words for you:

"Lynne Fennah, Chair of Home REIT, commented:

"The Board is extremely disappointed by the significant value reduction announced today which reflects the information that has come to light regarding the quality of the Company's assets and tenants. This information is in contradiction to reporting provided to the Board during these periods.."


Not us, guv.

[spectoacc] 11/12/2023 12:06

Yes, one of HOME's. Was one of 10 they bought in a block transaction for £848k I believe (it's possible there were other block Peterlee purchases but the numbers won't be substantially different). Post #274 for detail.

Note also that the average c.£85k cost will likely have been bumped up by Knight Frank post-purchase. HOME describe their proceeds from the auction sales as they relate to cost, not to NAV.

Part of the purchase price will likely have been round-tripping of the first 12 months of rent. As we now know, the actual rent in some cases was never enough to maintain payment (see eg the Mears portfolios).

[gpvxxx] 11/12/2023 12:06

At least they could have removed all the trash (bags) before advertising the property.

[gpvxxx] 11/12/2023 11:58

@ SpectoAcc
that Peterlees object - is this a HOME Reit property to be auctioned? What was the purchase price for this?