Real Estate Credit Inves... Share Discussion Threads

[cwa1] 09/4/2021 07:17

Looked but couldn't see either

[playful] 09/4/2021 07:06

Can anyone see this March fact sheet?

[chucko1] 01/4/2021 13:01

They're not exactly busting the bank, but it is something.

[evaluate] 01/4/2021 11:15

Positive signs that they think these are undervalued.

[flagon] 01/4/2021 11:11

Another director buy this time for 7,250 shares ...

[cwa1] 31/3/2021 13:42

Minuscule director purchase:-

[playful] 29/3/2021 14:40

I topped up too

[chucko1] 29/3/2021 12:22

The lending to European infrastructure is not insignificant and this may have caused some recent concern. I like this, but small holding and adding slowly.

[williamcooper104] 29/3/2021 11:54

Yep - no reason why shouldn't be at pre pandemic levels

[cwa1] 29/3/2021 11:45

FWIW, I took a few at 134p too, not as many as I wanted but I have probably more than enough already anyway.

IF it can maintain the dividend/asset cover/etc, then surely it looks cheap?

Fingers crossed

[flagon] 29/3/2021 11:34

I've bought in here ... last Friday & this morning. FWIW Hardman & Co forecast a maintained dividend of 12p for next year.

[williamcooper104] 25/3/2021 21:57

Credit losses are very little this cycle - hotel/leisure assets are mainly getting good recoveries Most lenders restricted their retail exposure way before covid hit - lending at 40-50 on retail assets, and avoiding the sort of stuff local councils bought There will be losses of course but taking the RBS portfolio as an example - it'll be a few hundred million of losses - which is literally nothing relative to what the banks dropped last cycle

[yieldsearch] 25/3/2021 21:52

Margin on real estate loans most likely to go up for number of lenders, to cover losses due to covid ( retail, rent moratorium). eg Natwest rbs is selling a 550m distressed retail property loan portfolio, natwest will make a loss and will reprice their risk.I guess if some tenants here are not paying their rent, it would impact the loan interest but this would have already been announced as we are one year into covid stress.

[williamcooper104] 25/3/2021 18:29

Hotel valuations on the up too - with Horizon/Holiday Inn portfolio going for well above asking

[holts] 25/3/2021 18:03

I would be surprised , they were able to pick up some good yielding investments last year , have had a number of loans re paid , no indication of defaults .

[skyship] 25/3/2021 13:52

Fears of a dividend cut seem to be the likely reason for current weakness. Don't see it myself as loads of cash and an increasingly higher NAV discount.

[hpcg] 19/3/2021 19:11

Maybe? I sold some because of other opportunities elsewhere and because of a change in my tax status next year wanting to move dividend payers (not REITs of course) out of ISAs. I personally couldn't care less about the dividend itself, much more interested in the total return vs volatility vs NAV. If I had a dollar basis I would be cashing out now as Sterling has very likely topped out.

[kenny] 19/3/2021 16:51

I guess we may not learn the level of the next four quarterly dividends until mid-May. See the historical RNS of 15.05.20 wherein the company confirmed that the next 4 would be at the same 3p level – e.g. up to and including the one that has recently gone ex-div.

Some big sales in RECI this week, which may suggest some of the larger holders may know/suspect that a dividend reduction is very possible.

[skyship] 17/3/2021 08:41

MONTHLY UPDATE:

• NAV as at 28 February 2021 was £1.518 per share, representing an increase of 1.1p per share from the 31 January 2021 NAV of £1.507 per share .

• Increase in NAV driven by strong interest income on the diversified investment portfolio.

• In February, RECI funded £0.4m of a new £18.5m RECI commitment (£64.0m total deal commitment) to a senior development loan to support the development of a 141-room
hotel in the Algarve, Portugal. The loan has an expected yield of over 10%.

• Also funded £3.2m of its existing commitments and invested £5.4m in the purchase of two new listed bonds

• The Company had cash at month end of £30m and gross leverage of £79m representing 23% of NAV and 1.14x net/effective look through leverage).

• A third interim dividend of 3p per share was declared on 19 February 2021.

[skinny] 10/3/2021 11:18

Yes thanks Dave.

[playful] 10/3/2021 11:16

Thanks Dave!

[davebowler] 10/3/2021 11:14

Liberum;
Strong income generation

Mkt Cap £314m | Prem/(disc) -7.9% | Div yield 8.8%

Event

Real Estate Credit Investments' NAV per share at 28 February 2021 was 151.8p, representing a NAV total return of 0.8% in the month. NAV performance was driven by interest income across the portfolio.

RECI agreed a new £18.5m commitment (out of a total deal commitment of £64m) to a senior development loan to fund the development of a 141-room hotel in the Algarve. The LTV on the loan is 56% and the expected return is in excess of 10% pa. Development completion is expected in June 2022. To date, RECI has funded £0.4m of its commitment. Other investment activity in the month included £3.2m to fund existing commitments and £5.4m to acquire two new listed bonds. The £388m portfolio is diversified across 61 positions with a weighted average LTV of 64.8%.

Gross and net leverage have increased slightly to 22.8% and 14.1% of NAV as a result of the new investments.

Liberum view

RECI's portfolio continues to generate an attractive level of income. The company's NAV total return over the last six months is 6.2% as the portfolio has also benefited from mark-to-market gains in the bond portfolio. The significant level of repayment activity in the second half of 2020 has enabled RECI to redeploy capital into senior loan investments with attractive risk/return characteristics. The average 65% LTV across the portfolio offers substantial downside protection against weakness in valuations. We regard the 8% discount to NAV and 8.8% dividend yield as highly compelling given the fund’s long-term track record, defensive positioning and potential NAV upside from re-rating opportunities in the bond portfolio.