Rdi Reit P.l.c Share Discussion Threads

[nickrl] 09/2/2021 09:37

RDI decides to an issue an RNS about West Orchards after the sale. Doesn't give much away only that its part of the strategy to divest themselves of shopping centres. NAV will be affected by 1.9m.

Goes onto to say " The sale leaves just one remaining retail asset in the UK, St. George's shopping centre in Harrow, Greater London.......achieving a full exit from the retail sector during 2021, whilst also contributing to the further strengthening of the Company's balance sheet"

So there looking for a buyer for that site as well lest hope they get a better price on that one.

These are becoming a play on hotels and flexible offices both could be winners but im not yet convinced and see these dropping back further.

[makinbuks] 08/2/2021 11:13

I assume Santander forced the sale and being in breach of covenant RDI had to go along with it knowing it would do nothing for them. Presumably Santander were disappointed with the result as they would have been hoping for more than the estimate of £5.5m.

The whole high street/shopping centre model needs reworking as the news of Boohoo buying all the Green brands without the outlets and then the demand to permanently end business rates, to rebalance the physical and online world, illustrates.

[nickrl] 06/2/2021 19:29

William interesting question and can see so no RNS or reference in last report as to there plan for this site. Looking at 2019 West Orchard accounts they note a covenant breach which was cured by RDI to the tune of 2.9m and this reduced the Sanatander loan to 7.5m which was repayable in Nov 21. Most of the liability was with RDI who had written off £18.4m that year as well and post year end another 6.4m was written off. Market value was assessed as 18m at 31/8/19 down from 26m from previous year.

Not one of RDI finest investments although im still surprised it went for so low and im guessing all the cash has gone to Santander.

Doesn't answer your question though!

[williamcooper104] 06/2/2021 17:45

Was it a consensual sale - eg borrower agreeing with bank to sell asset at less than loan value - better for borrowers reputation with the bank and the bank avoids cost of an admin

[skyship] 06/2/2021 15:52

Frankly, a rather strange decision to sell - better to have held or put into a JV with someone.

[grollfam] 05/2/2021 13:02

Equity was largely written down to zero at 31 August. The bank loan was £7.6m, so Santander has taken a bigger haircut than RDI.


The chilling thing is that this is an indicator of future UK shopping centre valuations



Luckily very little Retail left in RDI...

[nickrl] 05/2/2021 11:04

1tx thanks for that update I did post the auction details on CP+ (#968) and made the bold conclusion

"Pretty sure it will fetch more than guide though"

well that was 5.5m so it hasn't!! Massive destruction of value and would have though a city centre location was worth at least that. Won't help valuations for this asset class at next qtrs NAV updates.

[1tx] 05/2/2021 10:07

Massive haircut on West Orchards Shopping Centre Coventry sold for £4.8m by Allsops on 3rd Feb;last valued at £21m,paid circa £35m!

[nickrl] 21/1/2021 11:17

Q1 trading update reveals the hotels segment is main drag and has basically been written off for another 6mths. No surprise but could have upside with staycation likely to be main holidaying opportunity this year. London serviced offices has declined slightly but in better shape than I would have expected as an easy cost for companies to switch off. Corollary also applies though its easy to switch on when the good times return but a lot of competitors in this space in London so rates bound to become competetive.



Based on collection rates they may make 47m NRI with about 32m of outgoings maybe a little lower with recent sales offsetting borrowings. So should be able to support the 5p dividend and a bit more.

Keeping an eye on it and certainly at 80p would be interested.

Note its messy P&L to actually fully understand (for a novice!) with all its JVs and associate companies so might be incorrect here.

[hugepants] 09/12/2020 16:32

Me too Buks. Portfolio looks much better balanced albeit 25% is hotels. LTV down to 32%. Divi has been halved but yield is still 5.5%. Next year should be much better for hotels/leisure sector.

[makinbuks] 04/12/2020 17:03

I'm well in the red here, so I hope you're right Pants

[hugepants] 04/12/2020 15:55

This one hasn't really joined in the recent rally. Looks good value at a 40% discount and with a significantly stronger balance sheet after recent disposals.

[micos] 04/12/2020 13:56

Thanks, Mackie. Good to have a company paying a dividend nowadays

[micos] 04/12/2020 12:11

Thanks, Mackie. Good to have a company paying a dividend nowadays

[mackie] 04/12/2020 11:28

Yep. 3/12 ex div, 4/12 record , 22/12 payday

[micos] 04/12/2020 11:12

Did RDI go XD yesterday?

[makinbuks] 10/11/2020 14:28

Thank you Rook, i had overlooked that. If Starwood can't "realise value" in hotel investments no one can.

[jh27] 09/11/2020 16:07

Break up and steady sale of assets over a 1-3 year period.

[rooky4] 09/11/2020 15:42

From the recent results (published 5th Nov):

"However, in addition to managing the hotel portfolio through a period of recovery, options to realise value will be actively considered in order to focus the Company's capital and management resources on the industrial and office sectors."

Leaves me wondering what Starwood's interest really is.

[makinbuks] 09/11/2020 11:57

Thanks, agree with your analysis. I suspect with Starwood the main investor now there will be more focus on the hotel sector although as you point out the current portfolio is challenged to say the least

[nickrl] 08/11/2020 22:44

Makinbuks distribution has increased % of portfolio only because they've cleared out majority of retail. The fact is in doing this they've now become leveraged to the Hotel and London Serviced Office market and given up on its best income stream in Retail Pks which by there own admission are doing well albeit unlikely would have maintained the current income stream but even their reversionary forecast is 6.6% vs 3% for hotel portfolio.

Their hotel partner RBH paid no rent for 2nd half and its not clear whats happened post year end but despite that and the benefit from various govt measures they also had to lend them best part of £4m and have provided for 50% not being paid back. Their also impacted by Travelodge and will be down 0.9m next year.

Industrial (distribution) is in good shape with big void let so reliable income stream here.

With retail pks now gone and hotels and serviced offices still under the cosh not sure the lowered dividend will be covered in FY21 so 5p seems max for now. However, with 150m from retail parks they've clearly got options on reducing debt or perhaps a share buyback.

[makinbuks] 05/11/2020 12:22

Seem to be trying to spin that they are now in the distribution market

[nickrl] 02/11/2020 09:30

RDI confirms its completed on Retail Pk transaction for £156.9 million reflects a 3.0 per cent. discount to the last reported 29 February 2020 values and a topped-up net initial yield of 7.5 per cent.



Not sure this will be seen a such a good move in the long run leaving them with a rump of offices, a hotel management business (umm) and an investment in a serviced office operation.

Anyhow results on the 5th this week.

[jh27] 07/9/2020 07:50

It’s a very good result for RDI. Their retail parks were actually quite good quality and it shows that there are buyers at fair value for assets in this market who can look beyond the word “Retail”. RDI are obviously being broken up by Starwood - what will they sell next?? Or will Starwood now take it private and keep the rest?

[grollfam] 07/9/2020 07:32

Agreed Cerrito , and the Group's pro-forma LTV based on the 29 February 2020 values will be reduced meaningfully to approximately 30.2 per cent. (29 February 2020: 41.8 per cent.).

this excludes the proceeds from the Hamburg property , which will further reduce LTV