Real Estate Investors Share Discussion Threads

[spectoacc] 25/1/2022 20:34

Perhaps look at what Bassi and the (non-Indian) FD get paid out of shareholder funds, the web of cross-dealings in a vast number of multiple companies, the buying/selling of assets even held personally, and the piece de resistance - the performance of RLE itself.

Keep up the good work @hillofwad.

[ravpabari] 25/1/2022 20:29

Wow! Hill of wad! Reading your comments this evening has certainly entertained me!
What’s with the obsession with Paul Bassi and his family (slag him off, yet read his book and recite it like a bitter ex)?? Disgruntled Ex employee perhaps? Or not a fan of successful Indians? 😂 really odd. Getting serious fatal attraction vibes from you. Sad that we live in a works where successful people are trolled and resented.

[hillofwad] 24/1/2022 12:32

They are selling the Burger King at the Market Centre Crewe in some attempt to get back value Loss of car parking income but net overall gain Big chuink of the car park has gone where they received a decent income
Desperate stakes gunning for a short term gain at the expense of a long term impairment

Initial rent of £82,500 per annum equating to £30.00 per sq ft.on completion in March 2022
Rent is reviewed every 5 years to open market value.
Offers in excess of £1,350,000 (One Million Three Hundred and Fifty Thousand Pounds) subject to contract and exclusive of vat, which reflects a net initial yield of 5.75% assuming full purchasers' costs of 6.02%

[nickrl] 24/1/2022 09:34

The other read across from BREI is that mediocre offices fell 5.3% so despite the valuation decline last half there is more pain to come although with some retail stabilising they may have some respite from that qtr.

[hillofwad] 24/1/2022 08:49

Yep all they had to drive out a few miles or so of the W Bromwich office and hoover up a few industrial estates and they would be sitting pretty Decided to go big hitting spending £20m on a retail centre way outside their experience A mangement headache for life but maybe some decent fees going begging! Gambling on office blocks with short leases ,betting on red but coming up black .Spending £9m to relieve Bassi of the burden of W Plaza which they just about got themselves out of jail on I would dearly like to know the terms of the new letting!

[spectoacc] 24/1/2022 08:40

@Hillofwad - BREI worth a read this morning, emphasising the point we've both made on here about RLE's lack of industrial. Industrial done +38% over the past year.

[spectoacc] 24/1/2022 07:00

Lol.

My guess: "It's all going great" (Or at least - only a mention of the parts that are).

[hugepants] 23/1/2022 22:41

No January update yet. Maybe this week. Let's hear what Shirley has to say.

[sleepy] 17/1/2022 14:34

Results should show level of bank repayments

[nickrl] 13/1/2022 14:33

They've been net sellers for over a year now and no sign Bassi deploying his skills to recycle some of the proceeds into acquiring income enhancing assets as he tells us.

[hillofwad] 13/1/2022 11:41

"Bassi is in no way a controlling shareholder"

Should imagine with friends and family a fairly substantial holding

He certainly controls the company. Able to stuff in personal property use his agency Bond Wolfe as a conduit for sale,acquistion letting and management fees

The amount of which is diffcult to ascertain as some of those fees will be paid directly to Bond Wolfe from occupiers for services rendered

So there is no way he is going to say goodbye to them

The problem is he wears too many hats Where are the best property deals like Leek going to end up

[spectoacc] 13/1/2022 11:11

Well, you know his & the FD's salaries!

Don't want to say too much, but there's an almighty red flag flying over RLE. Accounted for in the discount in part, at least until the flag pole falls over.

Know of no other REIT with those related party transactions & side hustles.

[hugepants] 13/1/2022 10:32

spec, Not too bothered at this yield. It's not ideal but this kind of thing is often exaggerated. Bassi is in no way a controlling shareholder. I'd be more interested in the total running costs versus other reits.

[trcml] 13/1/2022 10:10

High yields are synonymous with little or no capital and/or rental growth.

[spectoacc] 13/1/2022 07:02

@HP - what do you make of the multiple connected parties re RLE, all the co's headed (& presumably owned) by Bassi & the FD?

[hillofwad] 12/1/2022 23:23

Nothing wrong with the properties at Leamington Spa but values certainly not moved up since purchase

Sure a few lettings coming thru the systen as you would expect Picked up a couple of tenants in Kings Heath but nothing has moved at Crewe the big one
Factor in falling rents on lease renewals and believe me £20m will never be seen again Not understimating an expensive £6m hit for venturing into treacherous waters
Any goodwork done elsewhere doesn't touch the sides here

Also A big?about Wilkos future occupancy when the lease expires

,Telford
Just the ground floor away at Titan House and there is a bit of interest in the upper floors but whether that gains full occupancy again is another question

Likewise Peat House in Leicester and Redditch another dodo

Nothing wrong with the out of town retail at Tunstall and Hollywood so no great haircut in values there

The convenience retail has been overpalyed .In Nottingham Sainsburys did a bunk relet at a susbstatntailly lower rent to a doctors surgery and the ex Bathstore unit is still empty

[hugepants] 12/1/2022 22:12

Contrast that with what Bassi said towards end of September (half way through current reporting period)

"....with occupier demand and decisions rising, strong investor interest and a healthy pipeline of new lettings on our void space, we expect this activity to translate into rising occupancy, improved income and further valuation recovery over the coming months, contributing to a rise in our NAV and supporting our progressive dividend policy..."

FWIW I think you are underestimating the value in the retail portfolio which contains retail parks, convenience retail and some pretty attractive looking high street properties ie Leamington Spa. I think that sector is where the rise in NAV is going to come from given you could easily argue mid pandemic was the nadir.

Current yield here is 7.3% and discount to NAV is 28%. It's certainly cheap.

[hillofwad] 12/1/2022 20:33

It would be very interesting to see the latest individual property valuations in the portfolio and whether they have been done externally in total. Certainly more damage since June and they have shipped out one of the crown jewels

What will be noticeable in the results is a cliff fall in revenue and increase in unallocated service charges . No doubt a lengthy rent free on West Plaza

Market Centre Crewe Very unlikely to get it sold for £13m + in today's market but what is it currently in the books at?

How do you value the 2 officee buildings in Oldbury both empty and one been empty for 5 years

Bond Wolfe are marketing them with asking price of £6.75m Diffcult ask to value but
as a specualtive buyer of both you really wouldnt want to pay much more than £3m

I doubt anyone would want to pay more than 50p per share for RLE and that is unlikley to interest Bassi with all the fee rakes for Bond Wolfe

[cwa1] 12/1/2022 17:31

Paul Bassi, chief executive of Real Estate Investors (RLE), the £72m Midlands-focused Reit, has previously complained of its wide discount and indicated he was open to a bid. Fund managers and top RLE shareholders JO Hambro, Premier Miton and Ruffer might be keen to see a takeover too given the shares at 57.7p languish at a 42% discount to their asset value last June.

I'm sure someone will be along to remind them why they think it is trading at a hefty discount :-)

[hillofwad] 31/12/2021 09:55

Just looking through their portfolio very little asset managemnent they can actually conduct to increase value apart from trying to get retailers on longer leases on the retail shops to turf them out to individual investors and secure some modest increases overand above book value

Its just a question of filling the voids in a damage limitation exercise. Some of the assets bought like Nottingham acquired on the strength of Sainsburys renewing their lease but broke it at he 1st opportunity the value will never be regained to exceed the purchase price

They need to buy in some expertise on Crewe before this degnerates any further

Perhaps the best route would be to sell it ,crystallise the loss and move on but suspect their ego wouldnt allow that

Ian Stringer the new non -exec from GVA is very much a Midlands office specialistt

[hillofwad] 31/12/2021 09:09

The irony is not lost that they failed to make use of their most valuable player Andrew Osborne

He had cut his teeth with a number of major players like Highcross & Kenmore who specialised in industrial property investment ,RLE based in an area renowned for metal bashing and the confluence of 2 major motorways. They could have filled their boots within 5 miles of West Bromwich and would have come out smelling of violets

Instead they chose to cast their net wider and ended up straying well out of their skillsets buying in assets like Crewe .

Suspect that this swerve from this major asset class is more to do with the fact that Bond Wolfe dont really deal with industrial & warehouse property The major conduit of deals arriving at RLE's door

[hugepants] 31/12/2021 08:42

The discount should be lower IMO :)