Regional Reit Share Discussion Threads

[nickrl] 07/2/2024 21:50

@RCT which is why they should have culled the dividend before now and short of some decent sale its all they have left in the armoury.

[rcturner2] 07/2/2024 19:35

The RGL1 is the first bond that matures so if they cannot pay it off or refinance then they will go under.

The current buy price is 91.35p.

You cannot annualise the return as that is meaningless as you are cut off at the end of August. If you buy 1 day before it matures you can't multiply the return by 365.

If you buy now you are getting a 10% return over 6 months.

[grahamg8] 07/2/2024 18:55

F=P(1+r)exp(n).
F=102.25
P=89
n=0.5
Therefore r=31.99%pa compounded.

Monthly return is a bit pointless as all the money arrives at the end in August if holders are lucky.

[arbus5000] 07/2/2024 18:41

what would that come to on a semi-annually compounded, 30/365 basis?

[grahamg8] 07/2/2024 18:07

Christ can't anyone work out a simple bit of maths.

RGL1 pays 4.5%pa and if we are lucky redeems at 100p in six months.
For £100 nominal of notes which will cost £89 at tonight's offer price.
You will get back £2.25 in interest 6 months worth (less 3 days to be precise)
You will get back £100 redemption, total returned £102.25 for a cost of £89 ignoring fees and the three days of interest. That's a profit of £13.25 on a cost of £89 over six months or 29.78% straight line basis.

[arbus5000] 07/2/2024 10:32

They look like forced sales by institutions / market maker.

[return_of_the_apeman] 07/2/2024 10:14

String quartet please report to the ships deck

The statements below show a lack of action and urgency which is laughable

"The Company is actively exploring a range of refinancing options for the retail bond given its near-term maturity date."

"we are witnessing increasing numbers of enquiries for our assets"

"22 February 2024        Q4 2023 Dividend Declaration Announcement"

[hindsight] 07/2/2024 09:55

As the bonds have a negative pledge, clearly one is now wrong

[cc2014] 07/2/2024 09:29

The bonds are in hero or zero territory.

There seems to be a disconnect with the bonds and the equity

[skyship] 07/2/2024 08:58

Fortune favours the brave...however I'm leaving well alone!

[cc2014] 07/2/2024 08:39

The annualised yield on the bond is now over 40% (although it's getting so far away from par I'm not sure my calculator is entirely accurate and it

anyway 85p ish to buy at one point and bond redeems in 6 months

[skyship] 06/2/2024 14:58

Not sure what the offer price is in those ZDPs; but sales today down at 91.5p, so now likely less than the 93.8p mentioned.

As CC2014 & Tilts have stated the GRY is now c20%. With just the one o/s divi the GRY would be 18.25%. Perhaps there are two o/s...

[williamcooper104] 06/2/2024 14:42

Yep it's not But given that the LTVs are not far off being breached which would shut of cashflow available to service any new unsecured loan I'm pretty confident the rate is going to sting I think the only way to refinance it is to raise enough to repay the retail bond and have cash to cure covenants Whatever happens think the divi is toast(And as many said should have been fully axed long ago)

[hindsight] 06/2/2024 14:29

Think the point is the market does not want 22% for the risk, its 8% + 2.25% - 0.5*5.25% = 7.625%

[rcturner2] 06/2/2024 13:58

That return on the current bond isn't the new rate though.

[cc2014] 06/2/2024 13:54

Indeed Tiltonboy. 22% based on the actual buy price available right now.

RCT: The bond matures in six months (well if it actually matures at all given what's going on but anyway) so that's around a 8% capital gain and a 2.25% coupon in 6 months, so for annualised double it.

[tiltonboy] 06/2/2024 13:46

The annualised return is over 20% now!

[rcturner2] 06/2/2024 13:44

I don't know where you get your figures from.

The RGL1 bond which pays 4.5% is currently at 93.88p.

This implies a yield of about 10 or 11%.

[cc2014] 06/2/2024 11:51

I've just shocked myself. The yield on the retail bond is 19.5%

So, given it's first in the stack with regard to maturity, that would imply some ugly number to refinance it. Retail bonds don't always price efficiently, but any number above 15% seems plausible.

[cc2014] 06/2/2024 11:00

A copy of my post from the weekend

With regard to RGL as I and others have written before, the balance sheet is in a bad place but worse the actions of the directors and Board are not helping it. At 55% LTV the dividend should have been binned last time, yet it's not even clear they will bin it this time.

This creates a feeling of lack of credibility over balance sheet management and inevitably will lend to all debt being renewed at a higher coupon that would have been necessary had appropriate action taken place. To be blunt the lack of credibility around the directors has been apparent for years as evidenced over the persistently wide discount to NAV when compared with peers.


In the end what price to roll the retail bond? The ENQ and IPF bonds are trading around 10-11% yield and they are far safer bets that RGL. That puts this in the range of around 15%, but I'm not even sure that's enough for an unsecured bond at the bottom of the stack in both time and subordination. There's another problem too in that at 15% retail investors walk away as the risk becomes crystallised in the coupon.

If the retail bond is reset at 15% and the dividend is reset to zero what price the equity? Something beginning with a 1 rather than a 2?

(and finally as I know someone is going to assert that they don't need to roll all of the £50m retail bond, if they were going to do that they'd be buying them back in the market now at well below par rather than waiting to redeem them later in the year)

The situation is becoming binary now. Either sell some assets quick and get the LTV down and the share price may rally or it's continual pain for shareholders as the balance sheet becomes more and more stretched as every day goes by.

Good luck to all holders. I don't think it's going bust but there could be very many years with no dividend.

[gliderpilot2002] 05/2/2024 16:26

They are not making the best of the situation. Failure seems s possibility.

[cruelladeville] 05/2/2024 16:06

Priced for bankruptcy?

[nickrl] 05/2/2024 13:56

New intraday atl here by my calcs

[skyship] 05/2/2024 13:28

arbus - sorry - I only look at and invest in the UK-listed propcos/REITs with Euro portfolios - ie: CLI, EBOX & SERE.. They all publish excellent webcasts in English; so can clearly see both portfolios & financials.

[arbus5000] 05/2/2024 12:53

any thoughts on alstria office REIT-AG (AOX.DE), which is trading at a 75% discount?

quite a few german reits have been raising LTVs to pay sonderdividends...