Tr Property Investment Share Discussion Threads

[skyship] 24/11/2023 15:56

The usual Phayre-Mudge rant - dream on sonny!:
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The investment community must learn to support opportunistic (and earnings accretive) capital raises rather than wait for share prices to trade at premiums before raising. The inherent issue with that traditional approach is that listed vehicles are flush with capital far too late in the cycle. Simultaneously we must all encourage consolidation amongst the plethora of smaller companies. The closure of many of the remaining open-ended, daily dealing PAIFs (property authorised investment funds) reduces the alternatives for private investors and the listed sector must grasp the opportunity. There is clear demand for exposure to real estate in a liquid structure through a closed-ended listed structure. However liquidity comes with scale and we welcome further consolidation in the sector.

[robertball] 23/11/2023 19:18

Out performing

[speedsgh] 23/11/2023 12:23

NAV pretty stable 304.74p (-0.1%) against 31/3/23. EPS down 39% as previously flagged in the last annual report. Interim dividend unchanged at 5.65p still covered by the much reduced earnings of 7.31p.

Half-year Report -

From Chairman's Statement...

Revenue Results, Dividend and Outlook

The interim earnings at 7.31p are some 39% lower than the prior year interim earnings.

A fall in earnings was flagged in the last annual report. Earnings in the year to March 2023 were flattered by some one-off changes and also a significant number of shifts in companies' dividend timetables. At the year-end we were also highlighting that a number of German residential companies and Swedish companies had announced dividend suspensions or cuts and the consequence for our earnings in the following financial year. Increases in interest rates have had a negative impact on our own revenue account and the increase in the UK corporation tax charge has also increased the revenue tax charge, although, our overall taxation charge (when taking into account the capital account credit) remains low.

A number of companies were quick to suspend or reduce dividends in the face of rising interest rates. It is still difficult to predict whether interest rates have reached a peak and how high they will stay and for how long. The property sector is highly sensitive to interest rates at both income and capital levels. The German residential sector is 14.6% of our benchmark, many of these companies have suspended or substantially cut their dividends while they reorganise their balance sheets, make sales to deleverage and reposition their portfolios for a higher interest rate environment. We expect them to resume distributions in due course but the timetable is uncertain. In the meantime, our own income account will reflect this reduced source of income.

Our Managers are mandated by the Board to meet the Company's investment objective, which is to maximise Shareholders' total return relative to the benchmark. They are asked to have an eye for the income account, but the positioning of the portfolio is driven primarily by the total return objective. There are times when it is not possible to deliver progressive income whilst meeting that total return objective. In light of the potential for leaner periods of income, the Board has strategically built healthy revenue reserves. Providing we are comfortable of achieving a covered dividend in the longer term, we will be happy to supplement dividend distributions from reserves.

The interim dividend has been maintained at 5.65p per share.

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From investment Manager's Statement...

Revenue and Revenue Outlook

The reduction in the current year earnings was fully anticipated and flagged in the Annual Report. A small element of this fall can be put down to timing differences with some dividends being paid in March, just before the last year end, whereas they had previously been paid in April and would have fallen into the current financial year as they had done previously.

More importantly, as we went into the results season for the German residential sector (15% of our benchmark), all those companies were announcing dividend suspensions or material reductions. With very secure earnings, low vacancy and structurally undersupplied markets, the underlying assets in these companies saw tremendous capital growth over the last decade resulting in lower and lower yields. The impact of higher interest rates had a dramatic impact on cashflow given the low yields and these companies have acted quickly and judiciously, taking action to reduce leverage through disposals and cash retention. Whilst they are not distributing this has had a significant impact on our income. Swedish companies also tend to be highly leveraged and we have seen a similar pattern, albeit the cuts were not as widespread. Sweden is just over 13% of our benchmark and although we were underweight (relative to the benchmark exposure) it still had an impact.

As the Chairman has highlighted, although we do aim for a progressive income profile, the primary objective is to exceed the performance of the benchmark on a total return basis. With dividend cuts in such a significant part of our portfolio, our income statement will be temporarily impacted. These companies will return to the dividend list in due course but the timing is still hard to predict and will vary from next year onwards.

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Outlook

The volatility in share prices highlights the ongoing battle between underlying property market fundamentals in our preferred sectors (stable to improving) and the relentless debate about yield curve trajectory and central bank behaviour. This 'whipsawing' has continued post the half year, in fact volatility has increased with the benchmark falling 9% through most of October only to then rally by 13% by the end of the first week of November.

Such volatility encourages us to focus on the core qualities of our companies safe in the belief that the vast majority have protected themselves from the impact of further short term increases in rates. We are also emboldened by the firm belief that we are seeing an increasing range of data points suggesting that the heightened rate environment is having the (central banks') desired effects, i.e. slowing their respective economies. We are clearly much nearer this cycle's 'peak rate' and the repositioning by investors is beginning to be reflected in share prices given where discounts have reached.

Public property companies are cautiously leveraged when compared to many private equity-backed vehicles. The eradication of equity in highly leveraged vehicles will provide investment opportunities for conservatively run listed companies. The investment community must learn to support opportunistic (and earnings accretive) capital raises rather than wait for share prices to trade at premiums before raising. The inherent issue with that traditional approach is that listed vehicles are flush with capital far too late in the cycle. Simultaneously we must all encourage consolidation amongst the plethora of smaller companies. The closure of many of the remaining open-ended, daily dealing PAIFs (property authorised investment funds) reduces the alternatives for private investors and the listed sector must grasp the opportunity. There is clear demand for exposure to real estate in a liquid structure through a closed-ended listed structure. However liquidity comes with scale and we welcome further consolidation in the sector.

[petewy] 23/11/2023 10:54

Healthy report?

[redponza] 20/11/2023 15:30

First of all, office may fetch a higher rent than laboratory or science hubs?
Secondly, regeneration into lab will require capital expenditure and many of the REITs are under so much stress that they are having a problem to get their heads above the water, let alone regeneration projects

[spacecake] 20/11/2023 14:15

Marcus Phayre-Mudge has been quite active promoting the fund in recent months.

I do wonder about the amount of unused office space in places like Canary Wharf, seems there's a fundamental change in progress, while at the same time there's not enough laboratory space in the UK, during the Covid pandemic crisis, testing labs sprang up all over the place almost overnight.

Yet building owners seem happy to just sit on empty offices rather than regenerate them into science hubs.

[speedsgh] 20/11/2023 09:52

Investor Presentation via Investor Meet Company -

TR PROPERTY INVESTMENT TRUST PLC is pleased to announce that Lead manager Marcus Phayre-Mudge will provide an overview of the fund, incorporating the recent half year report, and give his outlook on listed UK & European Real Estate Investment Trusts (REITs) for 2024 via Investor Meet Company on Friday 1st December 2023 at 10.00 a.m. GMT.

The presentation is open to all existing and potential shareholders. Questions can be submitted pre-event via your Investor Meet Company dashboard up until 9.00 a.m. the day before the meeting or at any time during the live presentation.

Investors can sign up to Investor Meet Company for free and add to meet TR PROPERTY INVESTMENT TRUST PLC via:

hxxps://www.investormeetcompany.com/tr-property-investment-trust-plc/register-investor

Investors who already follow TR PROPERTY INVESTMENT TRUST PLC on the Investor Meet Company platform will automatically be invited.

[mozy123] 20/10/2023 14:19

Have been buying monthly. With retail sales weak, and wider economy showing signs of slowdown I think we are at the top of the rate cycle. Probably be 12 months under water before recovery but I will never time the bottom.

about 2% of my IT portfolio.

[essentialinvestor] 20/10/2023 14:02

Their holdings are already trading on a discount, some very large,
so you are effectively getting an, admittedly modest, double discount -
all be it one with a 0.84% annual management charge, I'm tempted to buy
just a small amount, but everything keeps getting cheaper, we are perhaps
near a fear and loathing stage for some cyclical stocks. Thx for the view.

[dlp6666] 06/7/2023 14:42

Nearly 6% yield after today's fall ....

[speedsgh] 09/6/2023 14:03

TR Property’s 5% yield a selling point after tough year for Reit investor -

[spacecake] 02/6/2023 11:45

Repurpose retail space, Metrocentre in Gateshead are onto this with our two largest NHS foundation trusts.

[speedsgh] 02/6/2023 09:09

~ NAV/share 305.13p, down 38% (31/3/22: 492.43p)
~ Revenue EPS 17.22p (+25.8%)
~ Full year dividend 15.50p (+6.9%)
~ Forecasting a fall in net income for current FY

Results for the year ended 31 March 2023 -

Chairman David Watson commented
"Markets have had to absorb huge increases in the cost of capital and real estate equities have suffered consequential price adjustments. However, this is an unusual cycle where both interest rates and rents are rising. In many of our markets property fundamentals are sound and we see few signs of over-supply."

Manager Marcus Phayre-Mudge commented
"For a sector where returns are anchored by income, these levels of volatility and multiple directional shifts are almost unparalleled. The whole period has been dominated by the ebbs and flows around interest rate expectations and real estate fundamentals have taken the proverbial back seat. However, looking forward, we anticipate a renewed focus on those sectors offering rental growth."

Outlook

Macro considerations continue to dominate. Markets have had to absorb a huge adjustment in the cost of capital and real estate equities have certainly borne their share of price adjustments. However, this is an unusual cycle where both rates and rents are rising. In many of our areas of focus, real estate market fundamentals are sound and we see few signs of over-supply. Our central assumption is that the interest rate cycle will peak this year but that inflation will remain above central banks' targets. Listed property companies are generally more conservatively geared than their private counterparts and this should stand them in good stead. The sector has been hit hard and many of our companies are trading at large discounts to asset values that have also been recalibrated. As in previous cycles, if the sector is undervalued then private capital will be quick to step in. Just after the year end, Industrials REIT, one of the Company's 10 largest holdings, announced a recommended bid for cash at a 40% premium to the undisturbed share price. More recently in early May, Civitas, the social housing landlord announced a cash bid from an Asian conglomerate at a similar premium. These businesses are chalk and cheese but both have proved attractive to very different groups of investors. These events remind us that, for many, real estate is seen as a crucial part of the investment jigsaw particularly in these inflationary times.

[riverman77] 24/5/2023 09:48

I'm pretty sure they did, although probably only about 1% of their portfolio so unlikely to move the dial. I'm wondering if they were working behind the scenes to encourage this as they have been quite vocal about the need for consolidation in the sector.

[piwood] 24/5/2023 09:45

LondonMetric Property PLC RECOMMENDED ALL-SHARE OFFER FOR CT PROPERTY TRUST

Did TRY open a position in CT recently ?

[speedsgh] 07/5/2023 17:30

This is from a few weeks ago now but highly recommended listening for general sector commentary or if you hold/are thinking of holding TRY...



15/4/2023
In this week’s edition of the Weekly Investment Trust Podcast, Jonathan Davis, editor of the Investment Trusts Handbook, speaks to Marcus Phayre-Mudge, manager of TR Property Investment Trust (TRY), and Jon Forster, co-portfolio manager at Impax Environmental Markets (IEM)...

[speedsgh] 02/5/2023 18:19

TRY has a pretty decent track record, well respected investment manager in Marcus P-M and is an ideal vehicle if you're looking for broad brush exposure to what is mainly commercial property. Half decent income (paid out twice a year as ordinary dividends, not PIDs, as TRY is not a REIT). I can't offer much in terms of timing the market, gave up on that a long time ago.

[kingolly] 02/5/2023 17:33

Thank you for the info. I think this trust is more diversified than most but I just worry slightly about valuations going forward. I have a small holding here but plan to add if there is another significant drop.

[speedsgh] 02/5/2023 14:27

@kingolly - According to their website, as at 30/9/22 the following sector allocations were exposed to residential:

GERMAN RESIDENTIAL: 17.7% (of NAV)
NORDIC RESIDENTIAL: 1.4%
UK/IRELAND RESIDENTIAL: 0.1%

out of a total NAV of 111.1% (don't ask me to explain that!)

[kingolly] 02/5/2023 13:19

Does anyone know what percentage of the fund is invested specifically in commercial real estate? Residential and warehousing looks ok going forward but shops and offices look shaky.

[speedsgh] 28/3/2023 17:05

Nearly 50% retracement from its ATH. Starting to look interesting as a LTH. Decent track record in view of property's cyclicality.

[petewy] 28/3/2023 15:42

You're back again Red where u been???????

[redponza] 28/3/2023 14:14

Is it a concern for you guys that the revenue does not cover the dividend in the half year result? Also with REIT starting to reduce dividends, there maybe further downside to the share price

[brad44] 28/3/2023 11:26

this from 10 years ago...back where he started!! i will be looking to buy in when funds permit, thats for sure.

Price: 185.80

No Opinion
TRY22 Feb '13

Mr Turner retired in March 2011, to be replaced by his long-term deputy, Marcus Phayre-Mudge. It remains to be seen whether Mr Phayre-Mudge will prove as adept a thinker as his predecessor. In the volatile 22 months since he took over, the fund has underperformed the European benchmark for property shares. But that's not long enough to judge a manager and the trust's long-term record, for which Mr Phayre-Mudge is partly responsible, shows substantial outperformance.

Over the past five years, which have not been kind to property investors, that outperformance can be attributed to a focus on quality - particularly balance sheet quality. The managers have been right, it turns out, to avoid companies and countries with high levels of debt. TR Property itself is modestly geared, with net debt of just £36m on a £483m portfolio, and Mr Phayre-Mudge closely monitors 'see through' net debt - the gearing to which the fund is exposed through its holdings. They have also been right to focus on those markets with structural growth, even if the relevant companies trade on punchy ratings. These include London, Stockholm, German housing and pan-regional shopping malls.

[mozy123] 24/3/2023 10:30

The contrarian in me says I should start nibbling at this.