Newriver Reit Share Discussion Threads

[waterfall city] 21/9/2020 22:07

Yes what price today for a shop, they definately exited at the right time.

[chucko1] 21/9/2020 20:01

Perhaps, but with the hindsight of knowing there was going to be a pandemic?!?

[waterfall city] 21/9/2020 19:28

Perhaps local shopping REIT had the right idea,sell off the property repay debt and return what's left to shareholders.

[chucko1] 21/9/2020 14:53

PLUS do now report in a more detailed way, but I would not read a cause and effect into that given everything that has gone on. In fact, the poor reporting and misunderstanding of what it meant was a reason to buy what had become a vastly undervalued stock.

Intentional and material omissions is another matter altogether, and there has been some anger about this on ADVFN re. REITs. Misplaced anger, IMO.

[fenners66] 21/9/2020 13:19

I did have a big go at Plus , it fell lots more after that (about 40% if I recall) and since has rebounded gloriously.

I have not read their recent reports - have they fixed the reporting issues?

"or even mere satisfactoriness) of a business. " - LOL

Of course not - you do not point out the flaws to a prospective buyer.
How many businesses have been sold at the top ?

[chucko1] 21/9/2020 13:05

Fair enough, but you also had a big go at PLUS!

Everyone accentuates the positive, and investors generally discount accordingly. On average, people discount too much in both equities and credit. Over history, credit spreads have paid three times the actual losses suffered. Equities have performed better than this, and I have yet to see a prospectus indicating the uselessness (or even mere satisfactoriness) of a business.

[fenners66] 21/9/2020 12:38

chucko1 - I had a moan about the spin in DX Groups results on Thursday morning, so its not just having a go at NRR.

Their share price was up at the time.... its declined about 20% since then.

[vow] 21/9/2020 11:45

Agreed on the commercial extension. The current situation encourages head in the sand mentality on behalf of tenants and landlords.

There are units out that that aren’t viable and retailers that aren’t viable. They’d be better served biting the bullet and moving on, rather than dragging it out.

Also if the unit and tenant are viable this would be a good time to negotiate their on going relationship so everyone knows where they stand, rather than hide behind this legislation.

[dhoult12] 21/9/2020 11:34

@Daffyjones, yes you are right the bad news of the government seemingly wanting rolling lockdowns till??? was not priced in. Keeps on coming. Will it last forever? who knows. The government seems intent on the Vietnam solution of saving the village by napalming it. Airlines etc have been hammered off the back of it as well.

The ability to actually chase national chains for rent due is key at the moment. The extension till December was poor in my view. Residential evictions have already started.

[spectoacc] 21/9/2020 11:15

Hmm I think we're due a bounce, I think there's so much in the price already.

But I agree re retail space - and all the "oh, just convert it to resi" simply won't work, in part due to where the resi market is about to go, and in part due, as you say, to cost.

Good luck with short, I bought some this morning, first in a little while :)

[hpcg] 21/9/2020 11:02

I'm short again. There is so much surplus space that potential renters control the market. A vast amount of retail space needs to be taken out of the market but a) that takes time, and b) that takes money. The cash required to redevelop will mostly come from the sidelines; those REITs without financial resources will have minimal participation.

Irrespective of fundamentals money flow is out. Until those that have decided to take their losses, or in reality preserve at least some of their capital, have exited, the share price will go down.

[fenners66] 21/9/2020 10:46

Just in case some think that I am newly negative on NRR just because of the covid situation - I'm not

I was looking to invest here for yield when the share price was about 360

When I thought it through , I got bearish on its prospects and decided against.

No , I did not short it - perhaps I should have

I did avoid an investment error though.

[fenners66] 21/9/2020 10:43

chucko1 - it does apply to lots of other companies and I have been calling out those I have noticed.

There is a reasonable correlation though

I call them out for spin
their share prices fall
sometimes to zero.

Is it just a coincidence or is there a desperation in the management speak that is forced on them by the underlying trading conditions ?

[fenners66] 21/9/2020 10:41

riverman77
a quick spreadsheet starting with 37% LTV and taking 12.3% off the assets
does not give us a 47% LTV it only explains 5% differential, 37% to 42%


So where did the other 5% loan to value rise come from ?

Ok if you no longer have the property in the portfolio - you don't have to show the "valuation" drop in the 12.3% fall

So maybe you sell at a loss and don't repay the borrowings..

[chucko1] 21/9/2020 10:30

Fenners66, that applies to all shares! So why the NRR diatribe? One of the best managements in the REIT universe (UK, at least), though they are having the kitchen sink thrown at them.

[riverman77] 21/9/2020 09:55

Fenners - you seen not to understand the basic fact that NRR is geared so a 12% fall in property values can lead to a 23% fall in NAV. Property valuations have not fallen by 23% (at least not so far).

[fenners66] 21/9/2020 09:45

chucko1
That's fine for you - but we know there are a lot who read the headlines only and do not read the details.

That's why the headlines are published with all the spin.

[fenners66] 21/9/2020 09:42

Go on explain the 23% fall in Net Asset Value then....

[debeege] 21/9/2020 07:30

Im assuming everyone on this board just has fenners ignored. Because the amount of times he's just blatantly factually wrong is unreal:

"Reading the accounts published June 20 the reduction of EPRA NAV per share
201p
261p
-23%

so yes a 22% valuation fall has been done before."

Thats a 22% drop in NET ASSET VALUE. Not a 22% fall in valuations. Can you even read?

"-12.3% like-for-like valuation decline"

Clown finally ignored.

[chucko1] 21/9/2020 07:27

Fenners66, you seem to have a phobia versus uncertainty! I, and many others I am sure, can assign probabilities to a variety of outcomes and determine a preferred level of overall risk. Not everyone in this world need be a bookkeeper.

[daffyjones] 21/9/2020 06:02

Down 17 % since dboult said the bad news was priced in two weeks ago

The problem with bad news is that there is an unlimited supply of it.

New restrictions on pub opening to be announced by BoZo tomorrow, likely a national 10pm curfew. Will be the final straw for a lot of struggling pubs that had just about got back on their feet.

[fenners66] 21/9/2020 00:38

Its not about the "facts" whatever the outcome comes out as , they stated in there after all that they had ONLY collected 52%

So if you are that tenant you can still use that as per your example above.

Its about the spin and when I read people - who are supposed to be investors - quoting the higher figures because they read and accepted headlines without looking closely - it winds me up that the BOD's have got away with exactly what they wanted.

Look at us we got 82% or whatever..... confirmed that one day it might get paid, so you can all forget about any risks , keep believing nothing can go wrong haven't we done a great job....

If I asked a credit controller how much money we got in and they gave me some spin about how it was 80+% when they had only actually collected 52% and decided that they would write off some of the rest - I would be wondering if I had the right credit controller.

[chucko1] 21/9/2020 00:14

So were NRR to say that they were only going to receive 52% (i.e. what they had actually received) of the rent and that was it, then an eventual receipt of, say, 66% (lower end of expectations) would indicate a management not in touch with the likelihood of the various scenarios - a picture they have made some effort to paint.

Even worse, were I a tenant, I would think that they are not expecting to ever receive my unpaid rent. So I would make no effort to pay it now or constructively negotiate. As a shareholder, I would think they were insane. 44% of the rent is due but unpaid; some will be, and some will not be as some tenants go bust. I can make my own assessment of that - not easy, but I know the answer is not zero!

Other REITs have been criticised in a similar manner by some on these boards for similar comments - and the outcome has been that they have generally being making accurate assessments. RGL (in particular), AEWU and AIRE come to mind. RLE to be determined tomorrow morning, maybe. Actually, this morning.

[fenners66] 20/9/2020 23:22

chucko1
actually it was more qualified than that

"Is just falling for the spin B/S"

It's the SPIN thats the B/S and I hate it.
They are not alone , I have seen the same style of statement elsewhere and challenged it on these boards.

Its clear to me that the intention at the time was to leave the reader with the impression that there was no risk to 75% of rents , at the time when they had only collected 52%.

But if a further 23% would not or more likely could not pay - no amount of soothing words about they are going to pay...... sometime.... cuts it for me.

Cash due and unpaid is always a risk and should be highlighted as such , not hidden under a pretty carpet.

[candid investor] 20/9/2020 22:12

Spectoacc...there is also a bear case as well, I agree...factors include.
.if share price is 46p now what price will it fall to when inevitable second full lockdown occurs..
..NRR's sector of the economy is less able to cope with second lockdown apart from 40% essential retail shops...pubs already reeling after first lockdown...a second lockdown could kill many of them off
..occupancy starting to fall quarter by quarter..risk over sustained reduction in renewals ...
...disposals all have low yield so they suggest safe assets although then again not much marginal loss of income resulting from their disposal
..asset valuations falls on the way..anyone's guesss...the higher they are the higher the ratio of debt to equity which is not good..
..time lag between loss of rent and converting to alternative purpose assets if that becomes required.
..Millenium International are slowly building up an increasing short position (never a good sign) ..they obviously think share price could fall to the 20p region
If I thought hard I could probably think of
more.
Two major advantages..no tax and as REIT any profit which is made will generate dividends which will prop up share price..
Secondly lots of cash should withhold the worst of storms..
It's worth noting that even a 50% fall in net revenue is about the break-even point in UFFO terms. Such is the benefit of running a high margin tax free business with at least 90% profits distributed to shareholders..
I will stay here for now but will be fastening my seatbelt for a bumpy ride..dyor..