Life Science Reit Share Discussion Threads

[ghhghh] 24/5/2024 15:16

But RAT have been around 18% for the last couple of months?

I reckon a lot more than 6m has been dumped since Hazelwood (at 5%) jumped ship in February.

It's the company brokers who are selling, I've asked LABs but doubt they tell me.

[spectoacc] 24/5/2024 14:37

RAT had 62m at last report, I reckon they've got shot of 4 or 5 million of those, from visible trades - but some may be late-reported by days.

Question is, do they want out of the lot?

If they do, I can't see it stopping at 30p.

If they don't, the dcb should happen much sooner - good luck.

[ghhghh] 24/5/2024 14:32

Specto

Yes potentially £1.5bn oversupply over next 10 years but flip side is that they anticipate this level of demand! The short term macro backdrop is clearly positive for LABs and they must be a takeover target at this level if the over 50% intuitional base wants out.

We've had so many false dawns re clearing out the seller but some large trades today. Normally when a large seller is eventually cleared the 'smart' money gets their snouts in the trough before the market realises.

However I've bought more at 34.2p and on the bid at 34p so don't bank on it!

[spectoacc] 24/5/2024 13:24

I don't disagree, but per post #210, this is £1.5bn coming from just one source:


@CWA1 - welcome aboard ;)

The upside potential of LABS seems to increase by the day, but it's a long time until the yield might be attractive compared with others

On the flipside - it's not going to go to zero.

[cwa1] 24/5/2024 12:38

I've just dipped the smallest part of my small toe in to take a sliver of LABS at 34p to join you crazy lot :-) NOT because I think this the is bottom-merely because I feel it is a lot closer to the bottom(always, rashly, assuming that bottom is NOT zero!) than it was just a short time ago.

As the seller doesn't seem done yet, this will probably fall further but at least I've taken a starter position and may well add depending how much further it falls.

Good luck to one and all

[spectoacc] 24/5/2024 11:48

Was discussed above - basically, a large amount of deep-pocketed competition coming for LABS. After all, what else do you do with redundant office space, when anything easily turned to resi has been done already?

[apollocreed1] 24/5/2024 11:45

There was a lot of news yesterday about the Crown Estate converting various properties into laboratories for research due to lack of supply, including their Debenhams property on Oxford St.

So I think the fundamentals on this are very good. It's small size works against it but it looks like a pretty clean choice if you are a long-term investor. They also have very low debt which is usually a good thing with a REIT. Looks like the best bargain in the IT sector when oompared to others on discounts higher than 40%

[spectoacc] 24/5/2024 08:02

You must be feeling this one a bit @ghhghh.

Are RAT, or Investec, or whoever, going to sell their full 62m? Who's going to buy them all?

Stuck in some from higher.

[robards] 23/5/2024 11:32

CousinIT, agreed. If the money is elsewhere and the money doesn't trust LABS, that is the logical solution.

[williamcooper104] 23/5/2024 11:29

Problem is that when they set up the best assets with best rent growth potential were trading at silly tight yields so LABS had to go somewhat off pitch - secondary location (though still good) in Oxford and offices with lab conversion potential in London (less good IMO) That they did this was of course because they couldn't have got the IPO away without promising a high divi yield You can blame the manager but equal fault lies in UK institutions prioritising divi over total return

[cousinit] 23/5/2024 10:54

I think the structure is done here.

The depressed price/wide discount has been sufficiently prolonged without the manager/Board being able to meaningfully address it that LABS will be tarred with it for a long time. That means no new cash and probably a shrinking pool of assets with a lot of concentration (some sales needed to fund capex).

Seems there is institutional money happily entering this space, so suspect the for sale sign needs to be officially raised.

[jpatara3] 23/5/2024 08:19

It begs the question "what is LABS management doing?", we have a life sciences sector worth over £90billion, employing over 300,000. This sector is struggling to find space and the rents are soaring. Even with more competition the sector will still require more quality labs.

[riskvsreward] 23/5/2024 07:55

If labs is already struggling to make a decent return on its laboratory investment, more competition/supply is not helping, is it?

[spectoacc] 21/5/2024 08:06

Which if it's "offices", isn't much different to CLI, who pay a 9% covered divi.

Isn't offices, I say, and will bounce somewhere above zero :)

[chrisdgb] 21/5/2024 08:04

Over a 53% Discount now.......

[leoneobull] 20/5/2024 19:56

Some pretty heavy selling here it seems. No position presently but the drip drip is off-putting

[spectoacc] 20/5/2024 19:41

Personally I think the divi cuts were sensible, but agree that after so many hands have been in the purse, there's barely an investment case.

The same applies to many REITs - small % charges on assets can be massive % of income.

But but but. How much of that is in the price here?

[hugepants] 20/5/2024 19:27

fwiw RESI did say in their last results that the rebased divi of 4.12p (cost of £7.6M) will be fully covered.

LABS should not halved the dividend imo. It was too drastic. Like it or not most people buy reits for the income. They should have knocked say 20% off it and tried to cover it in the next few years.

[cwa1] 20/5/2024 07:41

Someone mentioned LABS to me the other day, so I thought I must have a look. I've had barely a 5 minute look so far, so barely even scratched the surface...

The share price chart looks brilliant, just the way I like it(unless, of course, they are genuinely awful/about to go bust).

A lot of the portfolio is in offices. As Graham Taylor once said: Do I NOT like that. I suppose there's an argument that it's "all in the price" already however?

Recent dividend cut...errr, sorry, "rebasing". Clearly not good news from an investor point of view but sensible from a business standpoint I feel. However there are loads of chunkier yields out there that remunerate you handsomely whilst you wait for the company to re-rate. So not perfect.

There looks to be a willing and commited seller out there. That cuts two ways of course but I'd rather be buying when there selling was coming to an end/drying up.

Having said that, it's worth a deeper look as there's a bit to do to understand it. Anyone care to add their tuppence worth? Or even just ring a bell when it's at the bottom? ;-)

[spectoacc] 16/5/2024 05:51

Indeed. The labs market is also attracting possibly too much capital - eg the conversions planned in Canary Wharf.

But it's all in the price IMO. If there were earnings to cover the original 4p divi, you'd forgive them down here (there never was, so the cut was sensible, but doesn't help an investment case).

[riverman77] 15/5/2024 18:00

Had a quick look at this the other day and thought it was looking interesting, until I realised about 55% of portfolio is actually offices. Not necessarily a problem if they're particularly well located but definitely dampened my initial enthusiasm!