Shaftesbury Share Discussion Threads

[deadly nightshade] 20/6/2020 22:10

Konrad I am here because I am invested here I put my money where my mouth is. If you are so negative on this then you surely you wouldn't want in at any price? As for struggling bars/shops etc the government have done more then enough to help folk with rates and vat breaks etc and furloughing of staff. A lot of people have knocked government over covid but I would struggle to think of many other countries with such generous furloughing schemes. As the old saying goes never moan about high prices because in 10 years time they will seem cheap. Nothing has ever gone down in price in the long run of my lifetime on this earth

[konradpuss] 20/6/2020 21:38

Deadly, I have traded this stock three times over the past three years on the back of buying below the NAV and selling above, helped by Sammy - RIP!

I was always worried the stock was 'priced for perfection'.

I know a tenant of a very well known wine bar close to Golden Square whose landlord is Shaftesbury. They have been squeezed over the last few years - rent, UBR etc. etc.
What it is like for them now, heaven knows!

I love the location, the portfolio but not the price.

I am hanging around for a fourth entry level.

The recovery will not be V shaped in my humble. The unemployment and working from home will have a massive effect on areas like Soho.

Now why are you here?

[deadly nightshade] 20/6/2020 21:22

nick what you might be forgetting is that these owners of these retail/ food outlets might well be running little goldmines in very exclusive area and although they will be feeling the pinch due to closures surley at the back of their minds if they have highly profitable business's when they are operating then it will be in their interest to work with landlords over possible deffering of rent. its a bit different if your a landlord of a tiny shop in a undesirable area then you might not worry so much about rent and handing keys back. also looking about you can see the economy is opening up and i have noticed the past week a real difference with people starting to get closer and closer together. all them little food/bar and coffee shops are opening up abroad and by the looks of it thriving. it could well be the econmey opens up a lot faster then people think. plus all the doom talk of massive unemployment and property prices crashes might well end up all unfounded fears. while we have rock bottom interest rates and plenty of cheap cash then surley asset price will not crash??

[deadly nightshade] 20/6/2020 21:11

konrad and nick are you invested here? if your not then why are you deramping? are you looking/hoping for a entry point? as for state of the market i would trust capc knowledge and dd of why they bought in here over a few derampers on this bb. that being said the derampers might well end up having bragging rights if we have some more short term carnage but surely quality always outs in the end and there is no denying that shb has some quality assets

[konradpuss] 20/6/2020 18:16

Essential, these folk are watching the rent not come in!

[essentialinvestor] 20/6/2020 17:54

Very little director buying in the sector atm.

I realise it is possible to read too much in to this,
however may be worth noting.

[nickrl] 20/6/2020 17:35

SHB tenants ain't going to be in a rush to open so June rentals are going to be mediocre and quite frankly unless you have some moral fibre what FD would pay anything given the govt has got your back to end September now. Furthermore with new Insolvency Act coming into force in weeks you can then instigate a 'company moratorium' and landords will then have to negotiate to avoid the business ending up in administration.

Can't see a dividend any earlier than Essential suggests and probably best outcome now is a merger of equals with CAPCO

[essentialinvestor] 20/6/2020 16:10

Bought a very small amount yesterday under 5.69.

My own take fwiw is it may be 3-4 years before we return to 2019 valuation levels.

[hindsight] 17/6/2020 18:30

Think second wave risk will be down to wash rates or lack of / social distancing in metres. Sweden excess deaths is now vitually zero, bar maybe some deaths brought forward. They release latest wash rates tomorrow so will see what Stockholm is up to. If its 20% then could indicate a 20% wash with 1m social distancing can hold the R & death rate. On other hand if somewheres 5% wash, 2m may need to be maintained

[essentialinvestor] 17/6/2020 17:28

Significant second wave is the big danger, tbf it applies to most of the wider equity market.

[konradpuss] 13/6/2020 21:52

Yup, eventually the landlords will be able to go after tenants for non payment of rent.

I would wager (I don't seem good at this - the non existent rights issue!) that the majority of Shaftesbury tenants have little covenant.

Look at the mix.

Retail - very few multiples.
Restaurants - very few multiples
Offices above shops - very few multiples
Residential above shops - probably no multiples

What they might have is quite a few rich private companies and individuals hiding behind private companies with little net worth.

O.K. they might have some rent deposits.

You watch the fleet of boards on their estate in the autumn.

[essentialinvestor] 13/6/2020 13:42

Nick's reference to the deck being stacked against commercial landlords
by current government policy is valid. I've made a similar observation
and whatever your sector view, it needs consideration.

We are in extraordinary times and arguably an extraordinary policy response was required.

However as physical retailers and other outlets reopen, how long will those businesses
be allowed to say...we can't/won't pay- without the ability of landlords to take legal action?.

[konradpuss] 12/6/2020 20:23

Essential, the early nineties were when residential property was being given away. It was so over bought in the late eighties.

I think Shaftesbury have a 'late eighties residential' commodity right now.

Now might not therefore be the time to buy. I would wait until there is 'blood on the streets' of the West End. It's coming - late autumn.

As to Cap. Co. doing a friendly 'take over', I do not see that one. What's in it for Bicknell? - a P.45!

[essentialinvestor] 11/6/2020 17:03

Nick, bought my first house in 1992.
The week I exchanged Pararoma ran an episode on how the UK housing market
would take a decade to recover.

I flipped it 2 years later for just under a 60% gain,
having spent about 4k on a very superficial refurb.

Then moved on to the next one.


However, as mentioned some cyclicals look too optimistically priced following the rebound from March.
Particularly some of the lower grade stocks.

[nickrl] 11/6/2020 16:58

Essential in terms of an opportunity to get hold a big stake quickly have to concur with your view although CAPCO will see no return on that for at least 12-18mths. Furthermore they've put a prop under SHB share price with there intentions now pretty clear they want a merger or a takeover and im pretty sure they would get the funding as well given how many other plc are getting hefty raisings' away without issue currently. As you say plenty of dosh in the system looking for home not because its makes money but earns fees for the bankers promoting them.

[essentialinvestor] 11/6/2020 14:45

I'm not sure Capco went too early, at least not viewing the transaction in wider context.

At the backend of 2009 prices in SHB's geographic location were already rapidly rebounding.

The large SHB stake became available this year, it was not as if they had a 2021
option on that.

Capco know the next 12 months will be incredibly ugly.

The investment also needs to be viewed in the context of their excellent
disposal timing on the Earl's Court asset. They effectively reinvested that money.

They were not attempting exquisite timing on acquiring Lee's shares,
the opportunity arose and it was grabbed.

[essentialinvestor] 11/6/2020 14:18

On my watchlist HLCL, DLN and SREI.

Of the above HLCL has the least retail sector exposure at approximately 2%, DLN is somewhere near 12%, from memory.

[konradpuss] 11/6/2020 14:11

It's the Central Bankers that done it!

They have just pumped so much liquidity into the system.

[essentialinvestor] 11/6/2020 13:45

The initial results day spike was on the lack of a RI imv, although there is
plenty of time for that.

As I mentioned here on Tuesday, equity markets may be underestimating the surge
in unemployment to come and its knock on efect with consumer spending/corporate profitability.

The flip side of this is liquidity chasing finite assets.

[konradpuss] 11/6/2020 09:48

nickrl, I could not agree more - they should be talking - "maybe the portfolio is over rented now?" Would the self serving management say that? I think not.

[nickrl] 11/6/2020 09:31

Konradpuss how they can talk about reversion when the ceo makes statements such as

“Tenants may be needing support well into next year. The traditional lease model is falling apart.”

“We’re likely to be supporting tenants, not just through lockdown but through recovery as well”

" We expect to collect just 50 per cent of the total rent due between April and September"

CAPCO jumped in too early as they will be in the same bloodbath but by next results reversion will be negative!

[konradpuss] 10/6/2020 20:57

Well no rights issue - glad William Hill don't take bets on such stuff! However the real take away is that they are really struggling to collect rent. Surprise, surprise!

Oh! and there goes Cap Co's paper profit.

The management are still rolling out the same stuff (read bull s.h.1.t) about a 25% reversion. Madness!

[essentialinvestor] 09/6/2020 13:05

Konrad, generally speaking I would guesstimate some cyclicals are Ahead
of fundamentals, even allowing for a forward looking equity market.

Atm we have is a liquidity wave chasing finite assets.

Now that may continue, or reverse to a degree.

On fundamentals, the coming spike in unemployment may be underestimated.
And possibly it's impact on corporate profitability.

[phillis] 09/6/2020 10:39

Covent Garden opening next week

[konradpuss] 08/6/2020 21:15

Essential - a paper profit!

Let's wait for the results.

A good friend of mine did an MBA with Sammy. He says he is very smart. He sold.

He might have sold because he was very negative on the prospects. He might also have sold due to margin calls on debt.

We might never know.