Newriver Reit Share Discussion Threads

[bondholder] 08/9/2021 14:42

Another 900,000 share bonus for the executives. Wonder how many they will sell to pay the tax?

[mindthestash] 07/9/2021 13:02

Hello gbjbaanb and ghhghh
Like you i think there's some mileage in this estate if the leadership did all the basics right even though town centre high street and shopping centres will change significantly with less retail and lower rents...............but this crew in charge - their track record is grim and are now distracted by pouring millions of the balance sheet into a 30% expansion into town centre retail and resi development.

thank you nickrl for pointing out how long these things take in their hands.

I simply dont buy Liberum forecast - which if you look at it what does it say NAV goes from 131 to 136 by 2024; they think thats a buy rating for real estate! are they kidding ? - must have let the graduate/intern cover for holidays......

It should be 6p divi now and withdraw from development nonsense and focus managing the changes in the sector across the portolio which will also have significant localised impact.

[bondholder] 07/9/2021 13:00

I was being sarcastic. Pathetic exposure of directors to company equity.

[gbjbaanb] 07/9/2021 12:15

He was given 10k as options and sold 4k to pay the tax, so 6k shares for nothing. Why would you think this is a story?

[bondholder] 07/9/2021 12:00

OMG. Will Hobman has acquired 4k worth of shares. Huge vote of confidence in NRR.....

[nickrl] 07/9/2021 09:34

ghhghh that is a reasonable view and one NRR has espoused over several years before Covid car crash came along but yet to crystallise it. Lets take Burgess Hill had planning approval way back in 2016 they found a partner for the resi element in 2017 yet here we are none the wiser when its going to happen. Oh and to make matters worse it will now cost more with the escalation in construction pricing and take longer to complete due to their prevarication. Then we have Grays another development that consumed many slides of their powerpoint presentations still stuck in the sidings.


Lets see what the capital markets day tells us.

[ghhghh] 07/9/2021 08:22

WFH and On Line means that town centres will be increasingly dominated by residential. Where I live a developer is attempting to change planning from retail/residential to residential. Existing retail and offices are being converted to residential. Those residents will want to shop, eat, drink etc and will want any excuse to leave their apartments.

Hence roll on a few years and remaining limited retail space will be in high demand.

Plus the emphasis will be buy local rather than clog up town centres with delivery vans.

[nickrl] 06/9/2021 21:43

It might have zero high st exposure but majority of its shopping centres are in town centres so local rental tone has a deleterious effect on everything over time. High Streets don't carry the service charge baggage either.
They have the retail parks which is good but last reports and accounts had three of those classified for sale but nothing has materialised so hopefully they've realised that isn't necessarily a good move nor is selling out to Bravo JV.

[gbjbaanb] 06/9/2021 17:55

Fenners, your analogy is poor. No retail outlet is going to move to the high street unless the rent is significantly cheaper and the footfall is as great as their current locations. It costs a lot to relocate, plus the cost of advertising add telling customers where to go now, etc. It's a huge cost. Your be better off considering new entrants, where will Lidl set up their next store etc

Fyi NRR has zero high street exposure.

I expect the high street to disappear soon enough, turned into housing ("for refugees" no doubt) with the odd coffee shop. The impact on the bookies, estate agents and charity shops will be significant and they are likely to relocate to corners of the shopping centres out of town - making NRRs portfolio even more in demand! And obviously that means more shoppers will go to these places rather than wander aimlessly around the old high streets. Increased footfall means more rent.

Shopping will not be replaced with online, there will always be people who need something now, or want to prod it with their sticky fingers first, or "click and collect" on their way home from work whilst picking up some milk from metro supermarkets that will end up co-locating there too.

NRR is unloved because the sector is, bit that doesn't mean they're not positioned correctly on it.

The loss of the pubs will make me re-evaluate my position (which had been good so far, though I did buy for the dividend) but I'm not convinced it's a basket case of doom at all. If any of the retail reits are going to do well one the dust settles, then I think NRR is probably the best one.

[fenners66] 06/9/2021 13:33

Huge Pants - that's a better point.
So the CFO makes it a game of poker, and leverages it still.

[hugepants] 06/9/2021 13:22

Is it as simple as that though fenners? I believe the rental cost in shopping centres is based on footfall. I expect many shops could find cheaper accomodation in a deserted high street but what would be the point?

[chucko1] 06/9/2021 13:18

Porsche, how many boards have you posted that message on?

You do realise, although it only partially explains the difference, that the DAX is a total return index, as is the DOW, whereas the FTSE is not. So to compare the FTSE with the DAX, for example, you would have to add back in all the dividends reinvested.

The S&P has big tech in it, so that's far out of reach.

FYI - from Dec 1999, total return of DAX is 3.97% per annum, whereas it is 3.66% for the FTSE. FTSE 350 actually has an equivalent 4.70% annual return, and that is an index more representative of the UK. In the last year, it is up 26.6%.

These facts are making your analysis look like a product of frustration.

[fenners66] 06/9/2021 13:09

gbj - As I have already posted above the relevance....

Enough people on here (I understand) believe that there is no relevance if shops are empty somewhere else.
Originally the view here was that if the shop next door was empty and not owned by NRR it did not matter.

Then if the whole street etc. it does not matter.

Now if the whole nearby town is empty it does not matter.

My point (already made) is that supply and demand dictates rent of other properties as a shop can always move and therefore negotiate a lower rent to stay.

We saw it 2 years ago with high street shops. XYZ has gone for a voluntary scheme of arrangement or whatever , so we want a rent reduction or else.....

If you cannot understand the point , let me give you a current football analogy.

Mo Salah , perfectly happy at Liverpool. Scores goals , has won trophy's, fans love him , earns a fortune.....

BUT , he now sees that others are reputed to be getting £500k a week. Result the new contract talks are for the same, because he could get it elsewhere , despite his current Liverpool contract.
Do Liverpool get held over a barrel and pay it? Or will he be moving for pastures greener?

You find me a CFO who looks at £m's of potential savings and does not try and leverage that with current suppliers and I will show you an idiot. The store does not have to move.

That's spelled out again, you don't have to agree, but if you do not understand the point now , there's no helping you.


PS in case you have not been reading this thread for 5 years or so, I was arguing the decline of retail then, pre-covid. Covid has only accelerated the trend.

[chucko1] 06/9/2021 12:26

They have the same number of High St. shops they did when the share price was both 220p and 43p.

Peoples' concerns seem to reflect the recent share price action rather than the real stuff going on. But this has materially affected NRR in that valuers were concerned about all sorts of properties when the shooting started in March 2020 and NRR's sale of the pubs more reflects a need to strengthen its balance sheet than any real issues with the business. That has cost them as they got an acceptable, but not good price in the sale. So some capital loss sustained. Some of the missing rent also has added to permanent loss of capital. But, I would say, not too much.

Nevertheless, there remain a lot of unknowns with NRR that will take time to play out. More years than I originally planned for, but that's OK - you manage your risk and therefore can deal with one or two stocks remaining challenging. This uncertainty worries some. They are not disposed to seeing ludicrous value at 44p (after a huge sale by an institution at indecent speed) and therefore missing what was 150% upside.

People who see NRR as simply one thing regardless of the price are unlikely to ever see what is on offer here. Same as EPIC was and RGL was. And SREI. And AEWU and some others, although NRR nearer the eye of the storm.

[gbjbaanb] 06/9/2021 11:43

I'll ask you again fenners, how many high street shops does NRR have? Because if the answer is none, then the question of what happens with high street shops is irrelevant. You might as well tell me shops in Afghanistan are failing to thrive.

They likes of b&m are already in the big and small shopping centres that NRR does own,

[nickrl] 06/9/2021 10:36

My local town centre has stupidly, imo, allowed several offices to be converted to resi and they've sold like hot cakes. I was surprised how quick they went then discovered majority are selling with help to buy support from gov. What not to like 25% of the loan interest free for 5 years no wonder they shifted.

So i can see why RESI is attractive currently but without this support scheme the demand will drop away and prices will no doubt fall back. You don't need to worry on this scheme as gov will share the losses with you.

Thing is NRR are late to the party here with no scheme underway and with elevated construction costs returns could a while yet but I suspect they are hunting for partners here as its not there core business.

Personally i see 6p divi sustainable but NAV will continue to drift down for several years as new lower rental levels continue to exert downward pressure and share price is reflective of that. Liberum always behind the curve i see NAV dropping to less than 120 this years then stabilising around 110 by 2024 when most longer term rental arrangements will have expired that support the rental yield.

Certainly interesting at sub 80p and always possibility someone will step in.

[ghhghh] 06/9/2021 09:56

Quite a bear attack going on here!

Liberum have recently updated. Buy rating. They estimate YE NAV at 131p and 136p by 2024. However debt will be halved by then from last year.

2022 dividend of 6.1p rising to 7.7p in 2024.

NRR is out of favour just as BMO Commercial and Schroders were. Once the large seller(s) are cleared we should get a bounce. The bad news now looks to be in the price

[fenners66] 06/9/2021 09:14

ok gbj - what is going to happen to the probably 100,000 + empty shops there are in towns now?

We have seen in the last 20 years a swing around from empty to full commercial premises on industrial estates, maybe retail will be cyclical too.

But we now have masses of warehouses servicing internet shopping.

We get deliveries 7 days a week, so like canals the world is leaving a lot of retail premises behind.

The only way to return as shops will be to slash rents, then you will get the likes of B&M , Home Bargains etc. reconsidering returning , I know they were there before.
IF they can rent on the High Street for next to nothing the point will come up at the next rent review. They do NOT have to go back to the High Street, they just have to threaten it and that based upon supply and demand will reduce rents.

Certainly every CFO should be looking to beat up their landlords.

The alternative for the High Street? Turn it back into housing , but who wants to live on the high Street?

[lord gnome] 06/9/2021 07:27

I am well under the water with my initial investment in NRR for the reasons that fenners66 states. I bought for the yield after hearing management present at Mello in Derby a few years back. I bought the idea of community stores. I bought the idea of community pubs and the alternative use possibilities after seeing a pub near me that NRR had converted into a community co-op. I liked the yield. I watched the share price fall back until it reached a level which I thought would act as support and then I bought. How wrong I was! The share price continued to fall and the divi evaporated.
I have, however been adding at these low levels in anticipation of a 7p annual dividend starting this year and a 10% yield on my purchase prices, plus a decent discount to nav.
The pubs have gone, the balance sheet is in better shape and the community shops will continue to thrive, as will out of town shopping.
I doubt that we will ever see the share price reach dizzy heights of my original purchase, but I can see a decent return on my total investment and a good income from it.

[gbjbaanb] 06/9/2021 01:31

But you don't say anything useful except "look the high street is closing", parroting the usual sensationalist headline stories.

I can see with my own eyes the high street is a terrible state, has been for years now. I can also see the out of town malls and shopping centres are packed full every time I drive past them or visit them myself.

People want to shop, they want to go out, nobody is going to end up living in a box never leaving it (well, maybe that will come to pass but only because the Tory government goes full CCP on us)

So, with this investment case you have, how many high street shops does NRR have? If it's none, then stories about the high street collapse are meaningless to NRR.

I will accept the case for interesting in then has changed with the pubs gone, but it's too soon to say if that will make enough of a difference. YMMV on that.

[fenners66] 05/9/2021 22:47

Well if you have any good news to counter , feel free.
There is no point in a board being an echo chamber.
From 300+ I have been told that NRR is different.
Their Pub estate was different.
That the alternate use was different.
That their collections were different.

So actually there have been a lot of bull points made.
I nearly invested for yield some years ago, that is why I started looking at them....

I have been told repeatedly that since (what is now left ) is different it is immune to any pressure on rents...

I happen to believe that supply and demand comes into pricing in non-regulated , capitalist markets.
The last 2 articles were from the DM and BBC , they could be in everyone's face already, but maybe some have not read.

I do appreciate having bear points pointed out about an investment or potential investment.
IF I can counter them, then I can invest , if I cannot I don't .

[alter ego] 05/9/2021 19:40

He seems to scour news for everything negative that he can post. The reason is unclear but he could be kind hearted soul determined to prevent us fools losing our shirts. Yeah right.