Newriver Reit Share Discussion Threads

[gbjbaanb] 01/11/2020 22:28

There are no idiots who refuse to wear a mask, that is simply rubbish. After all, we brought cases right down the first lockdown and nobody wore masks. Masks are a political show to make it appear they're doing something. (See Deb cohen, newsnight journo's tweet on 12th jul)

Anyway it is unusual that cases rose because of students, and yet students are the ones that are not being shut down. It's bordering on criminal negligence.

So tomorrow expect carnage in the markets, nrr will drop, and I expect drop by a lot. Tons of business that were holding out from the 1st lockdown will now pack it in completely.

And if Farage does come up with a new party, expect carnage in the elections in 3 years time too. That's probably not a bad thing at all.

[chucko1] 01/11/2020 14:19

Candid, a voice of reason. Don't forget, looking back in 2 years time a further wait starting Thursday of 6 months may prove to have been a great investment which impatience is the great foe of. It's tough, but getting high returns on investments was not supposed to be easy.

Those who always look for easy (stress-free) investments are in la-la land.

[candid investor] 01/11/2020 14:10

The most stupid thing of all is that kids can still go to school...the massive re-surge in Corona virus cases came after kids went back to school (and uni)...they must surely be the major cause of the spreading of the virus this time...oh and the idiots who keep refusing to wear a mask.
The lockdown had to happen..I would keep it going for 2 months rather than one...this will allow Christmas to be cancelled this year which would have left the virus completely out of control
A 2 month lockdown isn't the end of the world..remember the aim is to minimise the spread until a vaccine can be found ..these lockdowns buy us time.. For me they are an investment not a destroyer in both lives and livelihoods in the face of this unprecedented pandemic..it will be over sometime and the share price and economy will recover ..we just have to be much more patient than we had all hoped.. I am not a fan of Boris either but what alternative does the party have ..most of them wouldn't cope any better either .one piece of good news , NRR has £140 million in the bank so we dont have a liquidity problem ...a few months does feel like a long time but in the whole scheme of things , it isn't.. The share price is only 60p...it was £2 before the pandemic..where else could you get such a low entry point for a well run business which is fundamentally sound...none of these problems lie at the door of management. ..for me this remains a good medium term investment .

[gbjbaanb] 01/11/2020 02:46

Yep, and in 4 weeks there will be no difference to "cases" of virus anyway. I hear Tory MPs are livid, and Twitter had exploded with anger, so I'm not convinced this is it yet.

The conspiracy theorist in me says that they'll make Boris resign, and then a new pm will be appointed who will immediately put brexit "on hold" (forever) and the virus will magically disappear shortly afterwards.

[daffyjones] 31/10/2020 19:51

NRR is screwed now. Realistically this lockdown and pub closures will last through to February. 50 incoming

[dhoult12] 28/10/2020 18:18

Fenners you have even been given the figures in the post above, you know full well that rates have not remained the same, has your bloomin council tax bill remained the same for a decade? So we can get rid of your "if".

2009 - 805 stores, lease costs 38.7m = £48k per store
2019 - 500 stores, lease costs 20.4m = £41k per store

So 15% down over a decade.

If you were actually interested in shoe zones average rent paid..

If specific for this of course rent paid per sq ft average per year is published.

[fenners66] 28/10/2020 17:06

If they think that rates will represent 60% of rent in 2021 compared to 26.4% in 2009 they are saying that

Now here's an IF

If rates cost remained the same - then the rent has fallen 56% since 2009

The argument is that rents and property values should fall 56% since 2009
what has been reflected so far ?

[nickrl] 28/10/2020 11:20

fenners re #3445 Shoezone 2019 annual report presentation explains it thus

2009 805 stores lease costs 38.7m rates 10.4m or 26.4% of rents
2019 500 stores lease costs 20.4m rates 11.1m or 54.3% of rents

Not quite comparing apples with pears though but can see the point there trying to make although at the end of the day the state be it councils or central govt have to raise a level of revenue! They also don't reference the reductions in corporation tax they've benefited from.

[fenners66] 28/10/2020 08:27

So how fast are they saying their rents are Falling ?

[fenners66] 28/10/2020 08:25

A little more detail from Shoe Zone - remember a growing value retailer using "value" locations -sound familiar ?

"In 2015 the government delayed the rates revaluation by 2 years which cost our business GBP1.25 million per year (GBP2.5m in total). The latest revaluation delay will be even more costly as rents during the period have fallen significantly further and consequently rateable values should have fallen broadly in line with rents. Never has the rating system been more unfair. Our rates as a proportion of rent have increased from 26.4% in 2009 to 54.3% in 2019 and forecast to be close to 60% in 2021. This is unsustainable for most high street retailers and closures will continue unabated until the government makes substantial changes."

[fenners66] 28/10/2020 08:22

Add to that the predictable second wave lockdown...
that was predictable 6 months ago.

[fenners66] 28/10/2020 08:21

From Shoe Zones Preliminary results - and just in case it is not clear to some - this affects the take up of retail property and thus adds to oversupply and contributes to reducing rents across the piece whilst hinting that valuations will come down -

"The suspension of rates in April 2020 was a significant benefit for our business in FY20 and was in line with the government's desire to save the high street. However, the government has announced the reintroduction of the antiquated business rates system in April 2021 and to make matters worse has delayed the revaluation. The consequence to Shoe Zone will be the closure of up to 45 stores prior to April 2021 and the potential closure of a further 45 stores in the 12 months following the reintroduction. In total this would represent the closure of up to 20% of our store estate in the next 18 to 24 months. "

[vow] 28/10/2020 08:18

National lockdown looking like a given now. Xmas will be brutal.

[diggybee] 23/10/2020 16:14

Chucko I kind of agree. A pound seems fair maybe a pound forty a bit rich but in a fair breeze. If they start paying divs again that will get them to a pound or so fairly quickly I think. There aren't any more dead hands in it. It took a long time to get rid of woodford and invesco and the after ripples too.

[fenners66] 23/10/2020 13:48

I have loads of times - oversupply of any thing affects all

[chucko1] 23/10/2020 13:28

33% - yes! one of the easiest 33% (between 10% and 36.5%, in fact) or so I have ever made (after the very large sale from some fund). Not in great size, though, to be quite clear as I already have a good holding of this. Every asset has its price, and the right value for this has little to do with COVID in the short run. We have moved into mainly either:

a) COVID in the medium term - i.e. extent/pace of recovery, and/or
b) alternative use possibilities.

Concerning b), other REITs (AEWU for one) are reporting positive prospects, although I sense it will take an amount of time to play out which exceeds the patience or risk tolerance of some. Therefore no quick medicine for NRR.

In terms of fashion shops and Costa Coffee et al, that was interesting when the share price was around 200p or higher, but is barely a factor of interest now. It's akin to REIT "train spotting".

I have lowered my average and will phase out (not entirely) my position between 100p and 140p. I still target an average of around 130p. This is for my own account. I run some other (larger) money where the average is around 80p.

I find with shares like this that have suffered a tsunami of bruises, you simply have to manage the risk, trade against the weaker hands and be prepared to go with it even if it takes years. So long as you are not over-exposed (which is why I settled for "just" an average 25% profit on a 30% increase in the overall position).

Fenners66, not on any single occasion have you related the news flow to a price for this asset - hardly useful to the risk-takers among us!

[fenners66] 23/10/2020 13:12

If you want to trade shares and make a profit (or a loss) fine, I can see what the share price has done as well

If you want to buy shares with long term buy and hold prospects - or long term dividend payers - there imo better options elsewhere.

Each to their own strategy

I was "right" from 350 down to 45p - did not invest
I am not changing my fundamental view of the company and industries it is in just because the share price is going up.

As for the merits of buy and hold as an investing strategy - is that justified by 21,640 % return ?

[fenners66] 23/10/2020 12:05

There will be new entrants to take the place of other retailers - but will they be online ?

" Edinburgh Woollen Mill, which owns Jaegar and Austin Reed has filed notice to appoint administrators, putting 21,000 jobs at risk.

Debenhams, which said in August it would cut thousands of jobs, is up for sale and trying to find a new owner.

The DW Sports chain which entered administration in August threatening 1,700 jobs.

Scots-based clothing retailer M&Co which has gone into administration and said it would cut nearly 400 jobs in August."

The final quarter of the year is not one in which to shut stores usually - Xmas provided much needed revenue , but if all of the above were to survive until xmas - what happens after that ?

[fenners66] 23/10/2020 12:02

I'm sure you saw this story as well....

"US retailer Gap could close all of its own UK stores, putting thousands of jobs at risk, as it mulls shifting its operations to franchise-only in Europe.

It may close all of its shops in the UK, France, Ireland and Italy next summer, the retailer said.

Gap could also close its European distribution centre in Rugby.

The retailer, whose sales have been falling in recent years, reported a £740m loss in the three months to May due to coronavirus disruption."

[fenners66] 23/10/2020 12:01

RPI September 20 Yr on Yr 1.1%

[fenners66] 23/10/2020 11:57

theprovosts - thanks for alerting us to the latest "retail sales figures"

Of course since this is a Commercial property company with an emphasis on retail shops and pubs the pertinent part of the "retail" sales figures is that based on bricks and mortar.

Its is interesting to note that the comparisons used in the official figures are not year on year but instead Sep20 vs Feb 20

Feb 20 sales were down 0.9% on the previous month whilst the previous 3 Februarys had all seen good rises.

So they hand picked their comparison as pre-pandemic but we can see the impact had already started.

Against the year on year comparison Online sales grew 53%
Online sales were 27.5 % of All retailing - compared to 19.1% a year earlier

So despite the spin its clear that since overall sales were just above inflation growth , year on year store sales were actually down about 8%

Not all "good" news is good news for landlords.

Add to that the suggestion that these figures will not last as new lock-downs bite.

Whilst I commend the ONS for trying to talk up the economy - on this BB specifically investors should only be concerned for the reality of sales figures for actual shops and for pubs.

What is the extent of new shut downs impact re "wet let pubs" who do not offer food?

[theprovosts] 23/10/2020 08:53

Since Fenners tries to find any piece of negative news in tabloids slightly associated with NewRiver (which he doesnt hold, i.e. the standard BB Troll). Here's whats really happening:

"The Office for National Statistics (ONS) said retail sales volumes rose by 1.5% between August and September.

Spending on groceries remained high, but petrol sales were still down as motorists made fewer journeys.

Sales are now 5.5% higher than the pre-pandemic levels seen in February.

The three months to September saw the biggest quarterly increase on record, as retail sales volumes increased by 17.4% when compared with the previous three months."