Real Estate Investors Share Discussion Threads

[speedsgh] 17/3/2020 07:55

Some excerpts...

"We are aware of significant opportunities, with a pipeline of acquisition opportunities. Due to the constraints of our available capital and our policy to retain our gearing at existing levels, we remain extremely selective. The availability of further capital would allow us to take advantage of these significant mis-priced opportunities, which have been driven by the distress and uncertainty caused by Brexit discussions and forced sellers at open ended funds.

We also remain alert to corporate opportunities and we anticipate a period of consolidation in the real estate sector."

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FINANCE & BANKING

Reduced cost of debt

With our longstanding banking relationships and access to debt, we will continue to secure additional bank facilities when appropriate, to support future growth and improve profitability. We will maintain a policy of being multi-banked across a number of established lenders.

We remain conservatively geared at 42.2% LTV (net of cash) and have significantly reduced the cost of our debt over the last few years and intend to maintain our gearing at the existing levels.

Our bank facilities were successfully restructured during the year with 72% of our debt fixed, through facilities secured with 6 banks and average cost of debt reducing to 3.4% (2018: 3.7%), down 8.1%. We continue to review long term rates to fix low cost debt when appropriate.

In December 2019, REI finalised a facility of £8.5 million with Barclays Bank for 4 years at 1.9% over LIBORsecured against a portfolio of assets, drawn down on 30 December 2019.

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DIVIDEND

7 years of continued dividend growth

One of our principal objectives has been to deliver attractive, sustainable, higher level dividend returns and we are pleased to have increased our fully covered dividend for 2019 of 3.81p, an uplift of 7% on 2018.

We have paid the first three quarterly dividends of 0.937p and propose to pay a final dividend of 1p.

The proposed timetable for the final dividend, which will be a Property Income Distribution (PID), is as follows:

Ex-dividend date: 26 March 2020

Record date: 27 March 2020

Dividend payment date: 30 April 2020

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COVID-19

The unprecedented and fast changing circumstances surrounding Covid-19 provide us with an uncertain landscape, however we have a strong, stable business platform and management have a proven track record of performing during periods of uncertainty, as demonstrated in the past.

We are alert to the potential impact of Covid-19, an unforeseen human tragedy on a global scale. REI has a risk averse strategy, stable portfolio with high levels of occupancy and multi-sector diversification, together with controlled overheads. We remain vigilant and, in common with all businesses, we are closely monitoring the situation. To date, there has been no noticeable effect on the business, however it is too early to quantify what the impact may be in the future.

Should it be necessary, our resourceful team is able to work from home without any restrictions and all provisions have been made to ensure that the business can continue to operate efficiently. Furthermore, we have received assurance from all third-party providers and partners that they all have contingency measures in place to support REI. All necessary actions are being taken to safeguard our staff and ensure the continued progress and success of the business, through difficult and unprecedented global circumstances.

[badtime] 28/2/2020 12:44

Doing some business today? :)

[spectoacc] 28/2/2020 09:55

You've more patience than me, I've been buying :)

Tho without getting into the debate on it, the rate Covid-19 seems to be mutating is a worry.

[rcturner2] 28/2/2020 09:51

I think the only way to handle a market like this is to drip your cash back in probably at the rate of 5-10% a month.

I have about 40% cash at the moment and will probably slowly buy back in using one trade a month.

[hindsight] 27/2/2020 18:38

I had been waiting for a property pullback, expected one later in the year on uk / eu trade deal talks. Todays document seems to make WTO more likely than the 50/50 I had pencilled in. Perhaps the virus which seems a passing event to me, will get the boe and ecb to make the politicians smudge massively the wording

[badtime] 27/2/2020 18:18

I only holds a few of these so wont be flogging them at these levels....a trade is inviting...but perhaps not yet

[tiltonboy] 27/2/2020 18:11

CC2014,

Difficult to know what to do for the best in these markets. I've got some business I can do in RLE, now they are back at these levels. I just hope markets in general settle down.

[chucko1] 27/2/2020 16:31

I admire the honest post. This is not an easy game. You always know who the fools are on ADVFN because, simply, they boast of their prowess.

All I can say is that I rarely have any conviction in stocks, so could never make 36%. But I do know risk and have been light on stocks for a long time and experienced merely average returns (albeit with pretty low risk). But, like you, I need to make the money last a heck of a long time!

[cc2014] 27/2/2020 16:22

Good afternoon,

Ok, if it helps anyone it has been me selling all day. 11 of the trades are mine and I've had to drip them into the market as and when the MM would take them. Any attempt to sell below the bid was pushed back by the MM with really stupid prices which I'm assuming they were working on the basis they were happy to rip people off as they know there are forced sellers today. I've finished now and have none left.

I've sold due to nothing more than I was very overweight equities and worse a large number of the positions were correlated as they move in tandem with economic and political news. So, I needed to de-risk. I shouldn't have got myself in this position in the first place by hey I made 36% last year by taking conviction trades so I have to suffer the pain too. I'm now down 15% this year but that's fine as I've now sold enough stuff the last 3 days the market won't impact my lifestyle even if it falls another 30%.

I now have the biggest pile of cash I've had since 2014 waiting for a home... Happy to sit on it for a while


Nothing wrong with RLE btw. Given how much everything else is falling it's held up well. Which tells us something.

[poacher45] 27/2/2020 15:56

You know this is the better value skyship.

[skyship] 27/2/2020 14:53

Yes, another trade beckons, but that is now so true of quite a lot. Even RGL back to 116p today, so could get back in there.....

[speedsgh] 27/2/2020 14:35

Opportunity knocks today...

[poacher45] 21/2/2020 09:38

This looks better every day:-
hxxps://citywire.co.uk/investment-trust-insider/news/barnett-backed-real-estate-investors-looks-to-do-a-mucklow-and-attract-a-bid/a1311102?section=investment-trust-insider

[spectoacc] 19/2/2020 17:24

Give me a nod when it's 5%. On current run rate that should be....2023. ;)

Honestly, Invesco - what a shower.

[tiltonboy] 19/2/2020 17:14

Invesco down below 17%...

[cc2014] 12/2/2020 15:08

Looking at the volume Premier must still be selling. Anyone know of anything else they are selling off in an irrational way as this?

[badtime] 11/2/2020 15:30

Bit of volume today

[cwa1] 08/2/2020 16:59

Much obliged

[tiltonboy] 08/2/2020 16:08

CWA,

There tends to be hard boundaries, at round numbers, as part of risk management.

However, in recent times (post Woodford/Barnett) there has been a growing emphasis on liquidity, with many managers now quoting how many days it would take to liquidate their portfolios, on the basis of historic volume. Compliance are certainly squeezing the nuts harder, and it will only get worse.

It is a crazy situation where Miton have continued to buy, therein forcing Premier to sell.

I will also be a forced seller at some stage, as internal limits on AIM listed holdings dictate. Thankfully it wont be too many, and with the price edging up there shouldn't be too many problems.

[cwa1] 08/2/2020 15:52

Hi tilts

If you don't mind me asking, is there any particular reason why taking it below 10% would be considered significant? is it likely to be part of their mandate for example? Thanks for any input.

[tiltonboy] 07/2/2020 17:57

Premier Miton below 10%. Wouldnt surprise me if they have finished selling now they are below 10%.

[cc2014] 07/2/2020 15:24

MM moved up again so presumably Invesco have sold what they want to sell this week and will want a higher price for the next lot.

[chucko1] 06/2/2020 17:13

That’s why it seems reasonable to switch from the likes of RGL into the suppressed RLE. Woodford and Barnett’s loss is our gain.

[spectoacc] 06/2/2020 16:05

To be fair, RLE one of the few not to have re-rated (AEWL of course another), so plenty of argument for higher. WHR, RGL, AEWU etc all holding most of post-election gains.