Real Estate Credit Inves... Share Discussion Threads

[davebowler] 21/1/2022 14:11

ARTL is slumping -a vaguely similar but higher charging fund.

[my retirement fund] 21/1/2022 13:19

No it was not tipped today, but they have in the past

[panshanger1] 21/1/2022 12:19

Questor tipping as a buy in the Telegraph today

[my retirement fund] 16/1/2022 12:13

I must admit I'm still puzzled how the post covid NAV has not been written back.

[fordtin] 16/1/2022 10:51

Skyship - Log chart tells a different story,


free stock charts from uk.advfn.com


Charting is in the eye of the beholder,
Get it out with Optrex!

The NAV chart in the link below is probably the most significant chart for RECI imo;

[spittingbarrel] 16/1/2022 10:47

Difficult to sell and give up that pretty safe yield.

[loglorry1] 16/1/2022 10:29

You are obviously pretty easily pleased. During covid they took a fairly big hit to NAV which has not been written back. Further the income is distributed as property income so doesnt come with normal equity dividend tax credit. Taking this into account there are plenty of other better income payers eg LGEN.

Having said that on a risk return basis RECI is v good.

[skyship] 16/1/2022 10:29

Agreed, great track record. However IMO RECI now running out of road; and to my mind a HOLD/SELL rather than a HOLD/BUY. May well re-test the 150p support; then drop further to 143p:


free stock charts from uk.advfn.com

[my retirement fund] 15/1/2022 23:28

One hell of a track record this: FY 2022 will be the tenth consecutive year in which RECI has distributed at least 7%

cant think of anything similar

[davebowler] 11/1/2022 09:03

Liberum;
10% NAV TR in 2021, positive outlook for portfolio performance

Specialist Finance

Real Estate Credit Investments

10% NAV TR in 2021, positive outlook for portfolio performance

Mkt Cap £353m | Share price 151.5p | Prem/(disc) 1.7% | Div yield 7.8%

Event

Real Estate Credit Investments' NAV per share at 31 December 2021 was 151.5p, representing a 0.9% NAV total return in the month. RECI has generated a 9.6% NAV total return in 2021.

December was a busy month for investment activity with four new commitments. RECI's total commitment to these loans is £51.5m, of which £7.1m has been funded:

Senior development loan to support the development of a logistics platform in France (£12.2m)
Senior development loan to fund the development of a 272-key hotel in Dublin (£9.7m)
Senior development loan secured on a student accommodation asset in Spain (£7.1m)
Senior development loan secured on a build for sale luxury villa development in Spain (£22.5m)
Two loans fully repaid in December, resulting realised IRRs of 9.6% and 8.9% (we believe one of the loans that has paid down is the mixed-use development in Wembley Park) The company's cash balance has risen to £67m (from £50.5m in November). The gross and net leverage ratios were 30.8% and 11.5% at 31 December 2021.

Liberum view

2021 has been another period of strong performance for RECI and there are no positions of concern across the portfolio. FY 2022 will be the tenth consecutive year in which RECI has distributed at least 7% of the opening NAV. The new commitments highlight the company's focus on senior lending opportunities. The opportunity set for new investments is very strong with attractive risk-adjusted returns on offer. We expect continued strong NAV performance in 2022 as we expect NAV upside in addition to robust income generation. The company previously disclosed it was reviewing exit opportunities for one of its UK housebuilder loans and we believe this could result in a reversal of a valuation reduction taken in March 2020 (we estimate the loan is currently held at c.50% of par).


The short duration portfolio is well-positioned to mitigate the potential impact of interest rate increases (weighted average life of c.2 years). The manager's differentiated origination capabilities provide a consistent pipeline of potential deals. All of the bilateral loans and bonds are self-originated, providing greater control and security. The weighted average LTV of 62.7% also leaves significant headroom in collateral values.

[williamcooper104] 09/12/2021 11:44

It's that plus long record of being proactively conservative in marking their book Such that when they say that they mean it

[loglorry1] 09/12/2021 11:33

From Lib comment ""we believe this could result in a reversal of a valuation reduction taken in March 2020" this bit interesting."

This is the intersting bit. I think this was 5.5p write down but 1p replaced so 4.5p left to write back.

[skinny] 09/12/2021 10:50

I've held since 2012, @62% capital appreciation +@7.6% yield.

[catch007] 09/12/2021 10:40

'no positions of concern' - this is key point that gives me confidence in the portfolio. The deployment of cash will further enhance NAV as opportunities arise. Excellent yield and RECI remains under the radar. I have been adding over recent months.

[loglorry1] 09/12/2021 10:27

RECI one of my biggest holdings. Seems solid enough and justifies slight premium to NAV here with such good income generation.

[skinny] 09/12/2021 10:25

Here's the .

[williamcooper104] 09/12/2021 10:22

Nothing not to like - always amazed RECI not more popular/well known

[davebowler] 09/12/2021 08:57

Liberum-8.7% YTD NAV return Mkt Cap £360m | Share price 157.0p | Prem/(disc) 4.5% | Div yield 7.6%EventReal Estate Credit Investments' NAV per share at 30 November 2021 was 153.2p, representing a NAV total return of 0.6% in the month. Performance was driven by robust income generation. Portfolio activity in November included £3.9m to a student accommodation deal in Spain (6.25% yield) and the deployment of £4.4m into market bonds. The £393m portfolio is now diversified across 63 positions with a weighted average LTV of 62.7%. The cash balance has risen to £50.5m (14% of NAV) and the manager expects several new investments in the near term. Gross and net leverage were 30% and 16% of NAV at the month-end.Liberum viewRECI has generated an 8.7% YTD NAV total return with robust interest collection augmented by mark-to-market gains. The performance of the portfolio has been strong with no positions of concern. The opportunity set for new investments is very strong with attractive risk-adjusted returns on offer. We expect continued strong NAV performance from RECI as we believe there is potential for further NAV growth. The company is reviewing exit opportunities for one of its UK housebuilder loans and we believe this could result in a reversal of a valuation reduction taken in March 2020 (we estimate the loan is currently held at c.50% of par). 

[brian3777] 04/12/2021 13:22

Interesting interview.
Shame about the poor sound quality.

[cwa1] 02/12/2021 10:15

RECI interview:-



Real Estate Credit Investments Why rising rates should not hurt RECI

[cwa1] 02/12/2021 08:28

XD for the usual 3p this morning, pay day 31/12. Nice

[badtime] 01/12/2021 22:35

Gd strength today

[my retirement fund] 25/11/2021 12:37

For a £10,000 holding, apparently the chargers based on an Investment £10,000 are:

If you cash in after 1 year £238
If you cash in after 3 years £715
If you cash in after 5 years £1,191

[catch007] 25/11/2021 11:58

I added a few more RECI today. Liberum points out 'no positions of concern' and if the housebuilder loan is indeed revalued will assist NAV. Yield is very attractive against this backdrop imho.

[davebowler] 25/11/2021 09:46

Liberum;
Attractive lending opportunities

Mkt Cap £352m | Share price 153.5p | Prem/(disc) 0.8% | Div yield 7.8%

Event

RECI's NAV per share at 30 September 2021 was 151.4p (previously reported), reflecting a NAV total return of 4.1% for the six-month period. This strong performance was a result of both robust interest collection and mark-to-market gains on the portfolio.

The portfolio is diversified across 62 positions in loans and bonds. Senior loans and bonds account for 76% of NAV and the weighted average LTV across the portfolio is 64.3%. Over 80% of the portfolio is self-originated bilateral loans and bonds, providing greater control and security. The underlying borrowers are typically well-capitalised institutions with significant operational and financial resources. The weighted average levered yield is 10.3% and the portfolio remains focused on liquid real estate markets (UK and France). The short duration portfolio is well-positioned to mitigate the potential impact of interest rate increases.


Recent months have been active in terms of portfolio activity. RECI received £47m in loan repayments in the period to September with further repayments expected in the coming months. The majority of the capital received has been committed to several attractive transactions. A recent example is a £20m commitment to a loan secured on a hotel development at Helsinki airport where the borrower is a state-backed entity (9% expected return and 50% LTV). The manager's differentiated origination capabilities provide a consistent pipeline of potential deals. The pipeline of new investments comprises 12 deals in Q4 alone.

Liberum view

Today’s results and recent updates demonstrate the strong operating performance of the portfolio with no positions of concern across the £404m portfolio. The opportunity set for new investments is very strong with attractive risk-adjusted returns on offer. We would expect further transactions in the hotel sector as the market outlook for leisure hotels remains positive and there is significant interest from private equity operators given the potential for attractive entry prices.

We expect continued strong NAV performance from RECI as believe there is potential for further NAV growth. The company is reviewing exit opportunities for one of its UK housebuilder loans and we believe this could result in a reversal of a valuation reduction taken in March 2020 (we estimate the loan is currently held at c.50% of par).