Schroder Real Estate Inv... Share Discussion Threads

[kenmitch] 27/4/2021 14:05

I agree with both replies and buying at inflated prices (along with wasting it on rubbish choices) is worse use of spare cash than buying back. It’s very likely there will be much better buying opportunities ahead for the likes of SREI. Question is how soon? It could be a good while yet. That’s a reason there’s this clamour from some for buybacks. They want to see cash put to use NOW.

Too much cash on the balance sheet is seem as inefficient too. The ideal (far easier said than done) is very profitable use of cash when there are tempting bargains. That’s far better imo than artificial means of lifting REIT and other share prices.

Investors can be too impatient. I look to buy after big dips and when dividends are therefore sometimes very big. Others look for quick in and out profitable trades and coincidentally perhaps, they are often the ones pestering for buybacks. So buying AEWU, AIRE, EPIC, SERE and now belatedly SREI (along with NRR) near or luckily at their lows last year has worked a treat, with capital gain up to 40% and dividend as high as 13% (for AEWU). The dividends alone make them worth holding, and if we need to be patient, just as SREI and others need to be patient before deploying cash, then so be it.

[chucko1] 27/4/2021 13:19

There may be a time that liquidity dries up, but the degree of leverage as compared with 2006/7 is far less (and the effect of decreasing liquidity is not linear). It is likely that the likes of M&G and L&G are past selling at haste and they have sufficient liquidity to deal with those anxious to sell their units. In other words, the period for opportunistic purchases is largely over.

[nickrl] 27/4/2021 13:09

Kenmitch i agree in principle but outside of distressed retail most other property assets that are desirable for the long term are holding up reasonably well hence getting the right property at a competitive price is a challenge so maybe the buyback not a bad shout. Even the open ended funds needing to find cash hasn't flooded the market with property either.

That said though is the current situation being propped up by the vast amount of liquidity in the system and as that drys up the reality of the shock will start to filter through into companies bottom lines and this is when we will see desirable assets on the market and will SREI be able to take advantage?

[kenmitch] 27/4/2021 12:43

SKYSHIP.


I know we’ll never agree on this, but no way is it QED. Buybacks favour those who want to sell at the expense of those who stay invested. I’ll resist adding QED! Yes buybacks increase NAV and eps, but that doesn’t translate, as so many buyback fans seem to think, in to higher share prices than would have been the case without buybacks.

e.g NAV can increase but the discount can widen. eps can increase but share price can (and so often does!) fall during and after buybacks.

It’s a topic for debate. It is not black and white.

[skyship] 27/4/2021 12:28

Exactly - the seller found a willing buyer through the buybacks. We took the stock, cleared the seller & added to our NAV. QED.

[kenmitch] 27/4/2021 11:28

No buybacks since the 12th. So the willing buyer (SREI) is no longer absorbing sales from investors who want out. Since the 12th the share price has gone up 10%. Coincidence? Possibly and we can never know for sure, but it happens surprisingly often.

[chucko1] 27/4/2021 09:49

Yes, although this particular market hasn't been, it seems. I'm not sure if it came across, but all I was trying to do was eliminate drunkenness for the reason for the recent rise.

I could still be wrong, though.

[shieldbug] 27/4/2021 07:51

But Chucko, markets are forward looking...

[chucko1] 26/4/2021 13:21

The price shot up prior to opening time, so you can't attribute it to pure revelry.

[rogerrail] 26/4/2021 12:09

The moment pubs start opening all seams well with the world, wonder why.

[playful] 26/4/2021 12:06

I love Mr Patience

[chucko1] 26/4/2021 11:50

There's Mr. Market and then there is Mr. Patience. Take your pick.

[essentialinvestor] 26/4/2021 11:48

Nice, it had to move eventually.

[badtime] 26/4/2021 11:42

Nice rise this AM

[cwa1] 23/4/2021 15:26

Do we seriously think there's going to be a lot of them?

[spectoacc] 23/4/2021 15:23

New cinema operators.

[1tx] 23/4/2021 15:18

I suppose the problem of playing hardball with cinema operators is if they go bust who do we let the empty purpose built premises too.....

[flyfisher] 23/4/2021 07:25

I guess that many arrears cases were waiting on the legal ruling concerning the scope of the landlords insurance cover for loss of rent against the occurrence of a notifiable disease.

[hugepants] 23/4/2021 07:03

I noted this from BCPT this morning;

"The capital value of the Company's portfolio increased by 1.14 per cent over the quarter. The industrial and logistics sector of the portfolio achieved another quarter of strong performance, increasing by 7.1 per cent."

AEWU also published a strong rise in the value of their industrial portfolio yesterday.

[flyfisher] 23/4/2021 06:57

AEWU were threatening legal action against cineworld a while back, but who is the other.

[frazboy] 23/4/2021 06:18

Rent collection update - 88% including deferrals, heading in the right direction, only retail slightly disappointing. Excerpt below is for comparison and is from the update for the prior quarter:

‘Rent collected for the quarter ending 31 March 2021 currently totals 85% of contracted rents, which is in-line with the equivalent date in the previous quarter. The breakdown between sectors is 94% of office rent collected, 97% of industrial rent collected and 54% relating to retail, leisure and ancillary uses collected’

Interesting update from AEWU this morning - I wonder who the well funded national tenants are that the RNS relates to. I’m guessing that sports direct and cineworld could be challenging clients for SREI to name but two.

[brwo349] 22/4/2021 18:16

It's edged just above the resistance level. A sickening lurch upwards looks imminent to me.

[sphere25] 22/4/2021 15:38

Wah hey! Unk has broken out.

Just a tad early here then :-)

(0.1p gain every three days will do now)

[shieldbug] 22/4/2021 13:30

It doesn't bother me that the price remains weak. As time passes the lockdown risk diminishes and therefore the value increases. Will continue to add.

[chucko1] 22/4/2021 11:50

All I can assume is that the seller is still lurking but has raised its target a touch (and ought to have done a few weeks back, but that's their call). Delayed gratification for the patient though perhaps some solace for the seller.