Jpmorgan Global Core Rea... Share Discussion Threads

[affemoose] 01/7/2024 11:17:38

True words. The new fund is looking to raise about 20Bm i think to start off.

But as you say - many a slip twix cup and lip.

[mwj1959] 01/7/2024 09:46:47

I've looked at PSH in the past, but unfortunately didn't invest despite the very attractive discount. My error! There is clearly room for the discount to narrow further, particularly with this new fund launch. I haven't looked into the new fund, but if it were to raise a significant amount and mirror invest PSH that would at the margin be supportive for the underlying share prices. But investors shouldn't forget that while there remains a discount arbitrage opportunity the main underlying driver for this share price over the LT will be the performance of the underlying stocks. At the end of the day these are equities and can go up a lot and down a lot. The discount is probably not going to help much in the latter scenario.

[affemoose] 29/6/2024 11:03:52

On a seperate note there may be a sort of Arbitrage opportunity in PSH

PSH is UK / Amsterdam listed fund by Pershing Square Capital. Current price is £41.82, NAV is £55.04 ($69.84)

So what you may say...discount to NAV in London IT's is hardly news... indeed.

But .. Pershing Square are launching a new fund in New York that will closely mirror the UK fund. This alone will draw attention to the UK fund and invite US investors to buy the same assets as NY but at a discount.

The NY fund will launch with an initial share price of $50, which means nothing on it's own, but who would buy that if they can buy the same stuff for a discount in the UK?

Add in some rebalancing of charges - the US fund should reduce the UK funds charges, it's complex, read the RNS's. But this has to be good news. The US fund will charge a flat 2% fee, waived for first 12 months.

In short - I expect the Discount to Narrow over the coming weeks/months until fund launch in NY. May be an opportybity to make a few quid.

Be interested in knowing what you think of this mwj - you are far more switched on than me.

Disclaimer alert - I own a chunk of PSH, it's one of my better investments and i'm up 60% on my original investment. I top slices out to rebalance a year ago and kinda wish i hadn't but that's the way it goes. I plan to hold or maybe add here. I may even take a punt on the US fund once it gets launched and the price delta's sort themselves out.

[mwj1959] 28/6/2024 16:35:20

Not sure who the major shareholders are other than Quilter, who sold down to 10% from 14% in May. Not entirely sure what message that sends...

[affemoose] 28/6/2024 14:42:45

Let us know mwj - this needs someone to lob a hand grenade in and stir things up. Wake 'em up a bit.

[mwj1959] 28/6/2024 09:58:32

My email to the Company Secretary / JPM Sales outlining my thoughts on the proposals and a willingness to discuss those with the Board got quick response. They said they would pass them on to the Board. I suspect I will hear no more despite highlighting my extensive experience managing / restructuring closed ended vehicles.

[mwj1959] 28/6/2024 09:54:49

No hedging as far as I am aware.

[p1nkfish] 28/6/2024 08:30:35

A concern for me is currency risk. Currency exposure had a bigger negative impact than real estate. Is there sufficient hedging? It looks like a large contributor to volatility given uncertainties in UK Post election not to mention any atte,pt to drive down the $.

[affemoose] 27/6/2024 13:37:49

I'd be interested if anyone else has an opinion on this. Anyone?

Just to make sure I have thought of all perspectives :-)

[mwj1959] 26/6/2024 09:31:25

err no indeed!

[affemoose] 25/6/2024 19:42:45

errrr. No?

[mwj1959] 25/6/2024 13:09:51

I won't be supporting continuation either. Let's hope there are enough of us to vote no to get a wind-up, but ultimately it will be down to the IIs. As you say they might well have been bought off, albeit what the Board has offered is pretty paltry in my opinion (and as an II in a previous life I wouldn't have accepted that as being enough). Would I want to remain in an illiquid asset for another 3 years on the hope that NAV performance will pick up and the discount narrow sustainably?

[affemoose] 25/6/2024 11:12:17

While i'm on a rant - there is not enough skin in the game from the Board or the IM's here in my humble opinion. Look across at PHP and the founder alone owns 1.8% on his own, let alone what the rest of the board own.

Compare that the to derisory Directors holdings in JARA - 0.003%

[affemoose] 25/6/2024 11:03:05

The continuation vote will be in September but.. reading between the lines of the Annual Report it seems that the move of Continuation vote frequency from 5 to 3 years is probably (my guess) a sop to the II's and they have had commitment to vote for continuation as long as they get the chance to do it again in 3 years - in short they've been given a 3 year stay of execution.

They must improve in the next 3 years or else the chop.

The chairmans statement indicates this 3 year stay of execution to me - or else why state that the real estate strategy would be done in '3 years'??:

"Over the next three years, the Board intends to reduce JARA's exposure to real estate investments and to recycle the funds released thereby into the other legs on which the Company is built. As well as the prospect of providing better performance, both the Transport and Infrastructure funds offer a higher yield than the property assets; an increased weighting in these sleeves should, in time, support higher dividends from JARA. Concurrently with this reallocation, the Board will continue to be proactive in buying back the Company's shares in a continuing effort to stabilise and narrow the discount, while providing a material NAV uplift for continuing shareholders."

SOrry for the long post, but I think we're stuck with this for another 3 years. I do get that it's been unlucky to have this launch in 2019 - pick a worse year!! But that said I am also undwerwhelmed with the efforts to reduce the NAV.

I will be voting to close this down in the continuation vote. I think i'll lose but ... if enough of us ('significant minority') vote to shut it down it will help focus on the NAV rather than just hoping economic conditions (read: Interest Rates and Growth of trade etc) become favorable, which they will but slower rhan I think most predict.

[mwj1959] 25/6/2024 10:49:41

I've emailed the Inv Tst team at JPM to highlight my displeasure and also point out that they are showing the NAV at 112p on the website. If only!

[davebowler] 25/6/2024 10:47:07

Liberum-
NAV update and review of NAVs for private assets
Analyst: Joachim Klement

Mkt Cap £157m | Share price 75.8p | Prem/(disc) -19.3% | Div yield 5.5%

Event

The company released its annual report for the period to 29 February 2024 and its NAV and portfolio update as of 31 May 2024.

As at 31 May 2024, the NAV was 91.96p, down from 93.92p at 29 February 2024. The NAV total return for the quarter was -1.0% and for the trailing 12 months -2.4%. Private infrastructure and transportation were significant contributors during the quarter, adding 1.4% in local currency terms, with private real estate debt flat. The private real estate equity sleeve was the most significant detractor, contributing -1.1% to performance, while liquid strategies contributed +0.4% in local currency. Sterling strengthened against underlying currencies, resulting in a net negative contribution.

The current allocation to the portfolio strategies is given below. The company currently has outstanding redemption requests in request of the US Real Estate Equity and Asia Pacific Real Estate Equity strategies. As more redemptions are received, this would reduce the allocation toward the strategic target of 15.0% for each real estate equity fund.



The company also confirmed its dividend target of 4.2p per share for the financial year ending 28 February 2025, for a target dividend yield of 5.5%.

The company said that the portfolio management team has reviewed historical transactional data in relation to the appraisal (carrying) NAVs for JARA’s indirect investments in private real assets. This review was conducted on 20 transactions since the second quarter of 2022 across US real estate, APAC real estate, and global infrastructure. It showed that exit valuations were largely aligned with the appraisal values at the time of disposal, with an average difference of approximately 2%. The board and the investment manager of JARA believe that this affirms the quality and resilience of JARA’s NAV. This is an indication of the rigour of the valuation process which is undertaken for each of JARA’s strategies and their underlying assets.

[mwj1959] 25/6/2024 08:45:58

So NAV down slightly at 92p, leaving share price at 75p at a 18% discount. Minimum 4.2p dividend for this financial year leaves it at a 5.6% yield, so a fairly modest uplift relative to the 10yrs Gilt and even less of a premium relative to cash. A very underwhelming effort by the Board to address the discount. In fact I would call it delusional. Shifting the AA slightly, continuing the modest buyback (which is only going to increase the liquidity issue for large investors) and increasing the yield isn't going to have much impact in my opinion. Share price reaction tells me as much.

[mwj1959] 17/6/2024 13:46:29

I added some more around current levels. Risk / Reward seems reasonable.

[affemoose] 17/6/2024 11:27:51

I'm watching ................

[mwj1959] 17/6/2024 10:01:03

Annual results were out last year on 30 June and 4 July in 2022, so a couple of weeks to go before the Board needs to come up with its plan for the future of the company, ahead of the continuation vote. Discount has narrowed, but based on latest NAV (End Apr) it's still 20% at a 75p share price Still unsatisfactory.

[spoole5] 31/5/2024 20:15:30

Anyone missing their divi from HL today?

[mwj1959] 24/5/2024 09:32:06

Share buybacks underpinning the share price for now. Given the size and round lot size of purchases (200k, 150k, 100k) there's clearly an institutional seller happy to give up stock at these levels. Is this more unwinding from Quilters?

[mwj1959] 22/5/2024 12:15:33

There is, of course, no guarantee that the continuation vote will deliver a wind-up result, but given the nature of the underlying assets (majority JPM private UCITs) I struggle to see how any sort of merger with another trust can take place and any partial tender offer would only amplify the liquidity problem. So, I continue to believe that a wind-up is the best solution. Even if the continuation vote passes it may be that there is a such a significant minority who don't want it to continue that the Board ultimately decide that a wind-up is the only sensible option. They've got a month to sort this out before Annual Results!

[affemoose] 22/5/2024 11:34:59

Looking at trades in this theres a lot of small selling, and only a few large buys - which I assume is JARA purchasing own stock.

Without the buy-back this stock would be going down fast. I cannot wait until COntinuation vote, I just want my money back :-)