Real Estate Credit Inves... Share Discussion Threads

[skyship] 22/2/2023 16:54

Hi BT - could you email me - seem to have lost you on my computer!

[badtime] 21/2/2023 19:43

Thanks daveb

[davebowler] 21/2/2023 14:56

1 new deal completed (£45.2m of commitments) since 30 September 2022
– No defaults in the portfolio
– Continued migration of portfolio to senior lending
– During the quarter, three French loans fully repaid, realised net proceeds of £23.6m, lowering the WA LTV of the
overall portfolio, and providing headroom to invest in new deals at enhanced IRRs

[davebowler] 21/2/2023 14:37

• Senior 1st lien loans now account for 89% of the book by value......

[davebowler] 21/2/2023 14:30

Just starting webinar
Registration Link:

[davebowler] 09/2/2023 09:53

Liberum;
Real Estate Credit Investments

NAV increases 0.9% in January

Mkt Cap £322m | Share price 140.5p | Prem/(disc) -6.0% | Div yield 8.5%

Event

RECI’s NAV per share at 31 January 202E was 149.5p representing a +0.9% NAV increase MoM (6.6% over the last 12 months). The increase in the NAV for the month largely relates to 1.1p of interest income and 0.2p of mark-to-market gains.

The portfolio comprises 60 positions with an aggregate value of £437.8m. The weighted average LTV has increased to 56.9% (+0.6% for the month). The Company expects to deploy its currently available cash resources in near-term commitments and continue to see growth in its pipeline of new opportunities. RECI had cash of £33.7m at the month end. The gross and net leverage ratios were 33.7% and 23.8% respectively at the end of January.

Liberum view

January’s performance is in line with expectations. The short-duration portfolio generates a high level of cash repayments, providing scope to reinvest capital at higher rates (current unlevered yields for the portfolio are 9.6% for loans and 9.5% for bonds). The opportunity set for new investments is very strong in this environment and the current 8.8% dividend yield represents attractive relative value, particularly given the focus on senior loans at low LTVs.

[panshanger1] 01/2/2023 17:32

Yes Would like to nibble a few more if we get a pull back

[skinny] 01/2/2023 12:24

Yes very acceptable - I've held for 11 years and will continue to do so.

[williamcooper104] 01/2/2023 12:20

Very pleasing update - what's not to like

[williamcooper104] 01/2/2023 12:19

Yep They really ought to expand - pref shares a good idea - I'd buy them

[my retirement fund] 01/2/2023 11:17

Lots of potential to grow nav and possibly a dividend increase one day in the distant future. Perhaps now is the time to restructure the business, issue a large tranche of preference shares paying say 7% and new shares and warrants say at or above NAV ? Embark on a capital expansion programme ?

[davebowler] 01/2/2023 09:17

30 January 2023

Real Estate Credit Investments Limited

Investment Manager's Q3 Investor Presentation

Real Estate Credit Investments Limited ("RECI" or "the Company") is pleased to announce that the Investment Manager's Q3 Investor Presentation is now available on the Company's website at:

RECI | Results, reports and presentations (realestatecreditinvestments.com)

An extract from the Summary section of the presentation is set out for investors in the Appendix to this announcement.

For further information, please contact:

Broker: Richard Crawley / Darren Vickers (Liberum Capital) [phone]

Investment Manager: Richard Lang (Cheyne) [phone]

Appendix: Q3 Investor Presentation Extract

Key Quarter Updates

-- Portfolio
- 1 new deal completed (GBP45.2m of commitments) since 30 September 2022
- No defaults in the portfolio
- Continued migration of portfolio to senior lending
- During December, three French loans fully repaid, lowering the WA LTV of the overall portfolio,and providing headroom to invest in new deals at enhanced IRRs

-- Cash
- Cash reserves remain targeted at between 5% to 10% of NAV
-- Dividend
- Dividends maintained at 3p per quarter, 9.0% yield, based on share price, as at 31 December 2022

-- Financing
- A mix of flexible, short-dated financing employed, alongside term-matched structured financing on selected high-quality senior loan deals

-- Opportunities
- The present crisis is set to continue through 2023, resulting in further constraints in bank lending and alternative sources of capital. The opportunity to provide senior loans at low risk points, for higher margins, is increasingly compelling

- The core European CMBS markets are experiencing market price declines due to increasing indiscriminate selling, presenting opportunities in the market

- The Company expects to deploy its currently available cash resources to its near term commitments and to build cash resources towards a very compelling emerging opportunity set in both senior loans and bonds

ü Attractive returns from defensive , Senior, low LTV credit exposure to UK and European commercial real estate assets

-- A focus on senior, 1(st) lien loans:
ü Senior, 1(st) lien loans now account for 89% of the book by value

ü Mezzanine loans have reduced to 11%

ü Top 10 positions are 100% Senior Loans

ü New origination is 100% Senior

-- Weighted Average LTV on underlying investments of 56.3% as at 31 December 2022
-- Predominantly large, well capitalised, and experienced institutional borrowers
-- Minimal exposure to shopping centres (<2% of GAV), secondary offices (0% of GAV) and logistics (3% of GAV)

-- RECI retains absolute governance, covenants and control, afforded by senior ranking and bilateral singular lending relationships

-- Portfolio has withstood COVID19 and is well place to withstand the current revaluations in real estate

ü Quarterly dividends delivered consistently since October 2013

-- The Company has consistently sought to pay a stable quarterly dividend from its distributable profits

-- This has led to a stable annualised dividend of around 7% of NAV
ü Highly granular book

-- 60 positions
ü Transparent and conservative leverage

-- Net leverage 25.0% (with GBP24.0m cash) as at 31 December 2022 versus a leverage limit of 40%

-- Non-recourse and limited-recourse, term, structured finance provides returns optimisation and financial flexibility on senior loans

ü Access to established real estate investment team at Cheyne, which manages c$5bn AUM

ü Access to pipeline of enhanced return investment opportunities identified by Cheyne

ü Robust mitigation against a rising rates environment

-- A high yielding portfolio, combined with a short weighted average life of 2 years, ensures minimal exposure to yield widening and the ability to redeploy quickly at higher rates

-- Pipeline is 100% floating rate senior loans

[jonathb] 19/1/2023 07:11

Uh, not today. What happened?

[davebowler] 13/1/2023 15:36

Big contrast to LBOW.

[my retirement fund] 13/1/2023 15:36

Yield looks very attractive.

[badtime] 13/1/2023 14:57

Showing a lot of strength lately

[davebowler] 12/1/2023 09:53

Liberum;
December’s performance is in line with expectations

Mkt Cap £323m | Share price 141.0p | Prem/(disc) -6.1% | Div yield 8.5%

Event

Real Estate Credit Investments’ NAV per share at 31st December 2022 was 148.2p representing a 2p decrease in the month and a +0.7% NAV total return (+5.9% over the last 12 months). The NAV movement in December was a result of payment of the Q4 dividend (-3.0p) and interest income of +1.0p.

The portfolio comprises 60 positions with an aggregate value of £433.6m. The weighted average LTV has fallen to 56.3% (-4.1% for the quarter). During December, three loans were fully repaid, which includes:

A Paris prime residential/retail building (c.5% exit IRR)
A portfolio of six freehold French hotels (c.8% exit IRR)
A hotel in the southeast of France (c.7% exit IRR)
A new loan-on-loan lending facility has been signed, and guidance is that this will increase portfolio returns and dividend cover. RECI expects to deploy its available cash resources in near-term commitments and continues to see growth in its pipeline of new opportunities. RECI had cash of £24m at the month end. The gross and net leverage ratios were 32% and 25%, respectively at the end of December.


Liberum view

December’s performance is in line with expectations. The Paris prime residential/retail loan that repaid in the month was RECI’s second-largest position at the end of November (£49.4m commitment) and its full repayment represents a good result for the company. Repayments in the month resulted in a reduction in gearing from 34% to 25% in December. The weighted average LTV on the loan book also declined c.3% to 59%. We expect proceeds to be redeployed quickly into higher-yielding, floating-rate senior loans, which will be accretive to dividend cover and future NAV growth. The opportunity set for new investments is very strong in this environment and the current 9% dividend yield represents attractive relative value, particularly given the focus on senior loans at low LTVs.

[chucko1] 10/1/2023 16:16

I have sold a few, but the remainder is likely to have a long tail. What is under the bonnet here seems to be of high quality. An 8.6% yield for the mixture of manager and risk level is still generous to my eyes.

[panshanger1] 10/1/2023 15:46

Drifting back towards NAVI see this as a long term hold and will add if we have another lurch lower Quite likely imho GLA

[cc2014] 10/1/2023 11:26

Sort of gut feeling. Whole market looks overbought to me so I've taken some money off the table. FTSE shouldn't be this high and if it falls I can't see RECI withstanding the pressure any better than any other stock.

[renewed1] 10/1/2023 11:14

Any reason???

[cc2014] 10/1/2023 08:06

Sold mine late on Friday.

[badtime] 20/12/2022 16:12

Ah ..but my reply only referred to Monday ...from now ..maybe lol

[spoole5] 20/12/2022 15:19

.......maybe!