Mountview Estates Share Discussion Threads

[jonwig] 16/11/2022 09:34

twells - the doings of the Concert Party are a mystery to me. Konrad is much more able to clarify.

Ads for "true valuation" of the properties, and "true" NAV, they performed this in (I think) 2015, and I was at the AGM following this. I think one section ofthe Concert Party requested it as there was talk at the time of Grainger being a bidder.

the then Chairman was asked if it would be a regular exercise. He said yes - rather unwisely as it had been very expensive (over £1mn?). He was sacked not long after.

Konrad has said he thinks the company will be sold. I've no reason to doubt that.

As for IC, I think they write more articles than they can publish. Some get slipped in when there's surplus space.

[twells1] 16/11/2022 09:13

I would be very interested in Jonwig or Konrad's view on the announcement of Mountview on November 14th that the concert party has been disbanded. Does that mean the family is further split? What are the implications of the ending of the concert party?

You will have seen the Investors Chronicle long article on Mountview. It is very suprising considering that Mountview is a small company with very few non family shareholders for there to be such a lengthy article. Who provided the information for the article. I noted in the article the comment on the extraordinary level of remuneration of the CEO for such a modest company and who is also very incentivised by his large shareholding.

I appreciate that a valuation of the assets would be of no benefit to the company who buy and hold assets until the property is empty but it would be of benefit to shareholders of what is a PUBLIC company in allowing investors and shareholders to have some idea of the real value of the assets. We also have no idea of the succession policy of the company which considering the age and shareholding of the CEO is of importance.

It is inevitable that Talisman will eventually buy out both the Sinclair and Murphy families but at what price and when?

[essentialinvestor] 12/11/2022 15:23

Konrad, added a few MTVW during the week as unlike many other businesses
there has been no share price bounce over the last few weeks.

I also created a new YNGN (Young's non voting) board, with YNGN currently
available on just 10 X forward earnings and at 50% below NAV.
Young's H1 results this week are stellar.

[konradpuss] 11/11/2022 20:05

Essential, I bet Mountview will be making some good purchases right now.

Am I still keen? Yes, although I think the share price will only fully reflect the assets when the two waring sides put down their weapons and sell to the William Peers Group.

When will that be? Well Duncan (CEO) is getting on and I bet he would like to sell on retirement.

Just my humble opinion.

[essentialinvestor] 11/11/2022 11:32

Konrad, are you still keen on MTVW?, thanks.

You seen the GPE share price lately ? - that was selling for a song a few weeks back.

[jonwig] 11/11/2022 07:35

How rare is this? An IC article about MTVW, and quite a long one.
But it has little to say about the company as an investment, and there's no recommendation.

It does have a lot to say about corporate governance and the history of the disputes, such as here:

The Sinclair family owns just over half the shares, and this ‘concert party’ is represented by one non-executive director. The other two non-execs were considered to be independent when they were appointed a few years ago. The Murphy family would like to have their own director on the board as well, for they hold another quarter of Mountview’s shares, which are mostly owned by Duncan Sinclair’s sister. But their attempts to have one appointed have so far been frustrated.

The dispute is really about the power resting with Duncan Sinclair and how much scrutiny he comes under. He receives about £1mn a year, and pay has become a rumbling issue. It costs £2mn to employ both him and Bray, compared with £2.5mn for the other 24 employees. That seems high for a £450mn company with an operating profit that’s fallen to less than £35mn a year.

[strathroyal] 06/11/2022 21:55

I notice that they are still finding portfolios to buy:

hxxps://europe-re.com/mountview-estates-acquires-uk-resi-portfolio-for-12-3m/70611

[konradpuss] 06/11/2022 20:56

Jonwig, agreed, it is implicit in the value of each house or flat.

I am aware of one commercial property which is a shop in the King's Road in Chelsea below some flats.

[jonwig] 06/11/2022 20:13

Investment properties total less than 5% of assets. I can't find any which are described as commercial.

The portfolio values will be affected by the implied cost of refurbishment, either by MTVW of a purchaser. The 2022 AR says this (page 25):

We have obtained an Energy Performance Certificate
(E.P.C.), or have valid exemptions for 91.4% of properties
in our portfolio with 6.6% awaiting re-test and 2.0% yet
to review due to access issues. Following these reviews,
we have undertaken, where necessary, loft insulation,
cavity wall insulation, provision for storage heaters and
dual plate power meters.

Not really helpful!

[strathroyal] 06/11/2022 17:40

So the vast majority of the portfolio is residential and won't be affected until 2028, is that the final verdict here?

[konradpuss] 05/11/2022 21:13

There are residential rules in respect of EPC's and commercial rules which are different

Mountview owns only a few commercial properties held as investments.

[jonwig] 05/11/2022 15:50

Surely they are residential. The fact that the landlord is a corporate isn't relevant to this aspect. The £3,000 cap exemption is valuable.

[twells1] 05/11/2022 15:23

thank you Jonrig for giving the facts. I have tried to improve a let Victorian residential property from a D to a C and it is virtually impossible. Involves moving the stair case to provide internal wall insulation and new kitchen etc plus rewire the house. Not a question of cost but practicality and of course tenant would need to move out ( where to?) when this was being done

I question whether Mountview's properties are commercial - they are residential??

Perhaps a question to the CEO of Mountview is in order
m

[konradpuss] 05/11/2022 15:18

In respect of commercial properties the 1st.April will apply to existing tenancies.

Many people are going to get caught out - there are big fines as well.

[jonwig] 05/11/2022 14:55

This might help:

Minimum EPC rating to be raised from E to C. The plan is to enforce this from 1 April 2025 for new tenancies, and from 1 April 2028 for existing tenancies. The government says this would be sufficient to bring more than 90% of D-rated properties up to a C rating, as well as nearly 60% of E-rated properties.

There are some significant exemptions, which might help MTVW. Lots here:

[twells1] 05/11/2022 13:51

If I understand it correctly the EPC rules over the next several years apply to NEW tenancies only. So effect on current tenancies will be nil and obviously Mountview sells or does up properties when tenant leaves. This will have an impact on properties that they want to purchase however. In that 60% of rented properties fail the test I do not see how it can be enforced. For older properties it can takes months to make a property EPC compliant with new electrics, kitchen, bathroom and tenants having to move out whilst work is done

[konradpuss] 05/11/2022 13:26

God knows, however EPC requirements might.

They own much old stock which probably has very poor energy performance levels.

The EPC watermark next April will make many commercial properties unlettable. This will even have an impact at Canary Wharf where some of the early buildings are over twenty five years old. It is a smoldering time bomb.

[essentialinvestor] 05/11/2022 13:12

Is increasing EPC requirements a headwind for their portfolio?.

[konradpuss] 15/9/2022 18:12

Talisman is the William Peers group.

They are my bet to be the buyers the family (both sides) sell to. When? who knows.

[jonwig] 15/9/2022 17:43

I don't know how significant this is, but we have a holdings announcement:



Talisman Dynamic Master Fund increases from 5.06% to 6.26%.

Who?? Not clear if they're related to Talisman Global Asset Management, based in London.

[konradpuss] 10/8/2022 15:44

strathroyal, you mean regulated tenancies and life tenancies.

I still think the two sides of the family will both eventually sell to the William Peers bunch. Just my humble opinion.

[strathroyal] 16/6/2022 16:21

Provide so little information in their results summary that it is difficult to see beyond the headlines. At least the Annual Report fleshes this out somewhat.

It does seem that the number of ASTs available to purchase is diminishing so debts should continue to decline and the dividend increase. My only concern is that being a small operation by number of employees, can they increase sales at both auctions and private treaty? Over the years, I've watched their lots in the four national auctioneers that they appear to use and, over any 6 month period, there doesn't seem much variation.

[jonwig] 16/6/2022 06:50

FY results:



I'm a bit surprised at the reason for lower profits - that they couldn't enter properties during lockdown. Surely they could do essential maintenance on empty homes, and even on occupied ones if necessary? Maybe I've just forgotten what the rules were.

Anyway, they shrug that off and we get a much bigger dividend as a new base.

[tmfmayn] 17/4/2022 17:27

MOUNTVIEW ESTATES: £11m Special Dividend Accompanies Acceptable H1 2022 Performance And Could Signal New ‘Run Off’ Phase Leading To Estimated Returns Totalling £264 Per Share #MTVW

"Add the spreadsheet totals together and MTVW’s eventual run-off value could be £1,029m or £264 per share paid through dividends."