Tritax Big Box Reit Share Discussion Threads

[jonwig] 08/3/2017 11:34

EI - BBOX's latest tranche of debt is 2.54% 10 yr fix. Rates linked to LIBOR might be a problem. "Borrow now while stocks last."

[essentialinvestor] 08/3/2017 11:12

jon, hold HSTN so agree with your view, however these borrowing rates may not
be available in perpetuity, worth keeping in mind.

[steptoes yard] 08/3/2017 11:04

Thanks for replying jonwig

[steptoes yard] 08/3/2017 11:03

Agree with the 5% over the 2.5% scenario the term of the debt. I think of these how a filthy private landlord with 30 houses is placed once the debt is gone. Most of the break clauses on the loans are after the debt period (5-7 yrs). The threat is interest rates but they ain't hitting 5% anytime soon - besides the covenant is getting stronger and stronger

[jonwig] 08/3/2017 10:49

Steptoe - for a propco, having no debt makes no sense. If you can borrow at 2.5% fixed and collect rents at 5% rising, what's not to like? Shareholder returns would suffer without leverage.

That said, you can have too much, as companies with 70% LTV found in 2009. Most companies seem to have learned that 50% is a prudent ceiling, and 30 - 40 seems to be the norm.

[gswredland] 07/3/2017 19:15

Thanks Shauney

[shauney2] 07/3/2017 16:34

A good summary of the results from the DIY investor

[steptoes yard] 07/3/2017 10:19

Buying gradually into these with the aim of it being 20% of my portfolio on retirement date

[davegk] 07/3/2017 10:15

thanks for the explanation

[jonwig] 07/3/2017 10:07

dave - you've worked out the gross asset value - subtract the debt to get the net value.

[nimbo1] 07/3/2017 10:06

Yep but I assume you have to strip out the debt to get the NAV per share and if you did you would get to 129.

[davegk] 07/3/2017 10:04

A very pleasing set of results but the something I can’t quite get, hope somebody can help. It says in the results

“Portfolio independently valued at £1.89 billion as at 31 December 2016 which includes all forward funded commitments.”

And also that on 31 December 2016
“EPRA NAV per share 129.00p”

A market cap of £1.89 billion divided by the 1.11 billion shares in issue equals £1.70 per share

[cheshire man] 07/3/2017 09:46

Excellent yield here!

Progressive dividend target of 6.40 pence per share announced for 2017

I'm not complaining about the share price rise either nimbo1 :-)

[nimbo1] 07/3/2017 08:58

I really can't see it continuing to go higher but I have thought that for the last week and it keeps going higher! Its 10% of my pennies now so I will be delighted to be proved wrong.

[skinny] 07/3/2017 07:05

Financial highlights

· Dividends declared in relation to 2016 totalled 6.20 pence per share, in line with our target. Dividends fully covered by Adjusted earnings per share of 6.51 pence.

· Total Shareholder return for the period was 15.1% (based on the increase in share price assuming dividends reinvested), as compared to the FTSE 250 Index, the FTSE All-Share REIT Index and the EPRA NAREIT UK index which delivered total returns of 6.7%, (7.0%) and (8.5%) respectively.

· EPRA net asset value per share increased by 3.46% or 4.71%1 on a like-for-like basis to 129.00 pence at 31 December (31 December 2015: 124.68 pence).

· Total return (being the increase in EPRA NAV plus dividends paid) for the year was 9.6%, compared to our medium-term target of 9% per annum.

· Market capitalisation of £1.54 billion as at 31 December 2016.

· Portfolio independently valued at £1.89 billion2 as at 31 December 2016 which includes all forward funded commitments.

· The portfolio's contracted annual rent roll has increased to £99.66 million (31 December 2015: £68.37million), which includes all forward funded commitments.

· Further diversified our sources of borrowing, with a new £72 million, long-term, fixed-rate facility with Canada Life. The Loan to Value (LTV) as at 31 December 2016 was 30.0%.

· A reducing EPRA cost and total expense ratio of 15.8% and 1.06% respectively, reflecting the benefits of increased scale.

· Raised £550 million of equity during 2016, through two substantially oversubscribed share issues.

Operational highlights

· Acquired 10 Big Boxes during the year with an aggregate purchase price of £524.4 million, further diversifying the portfolio by geography and tenant.

· As at the year-end our portfolio comprised 35 assets, covering more than 18.2 million sq ft of logistics space.

· Four forward funded pre-let developments reached practical completion in the year, with a total valuation of £272.8 million at 31 December 2016.

· Average net initial yield of the portfolio at acquisition is 5.70%, against our year-end valuation of 4.93%.

· Our portfolio was fully let, or pre-let and income producing during the year.

· At the year-end, the weighted average unexpired lease term ("WAULT") was 15.3 years, against our target of at least 12 years.

Post Balance Sheet Activity

· Progressive dividend target of 6.40 pence per share announced for 2017.

· Invested in the forward funded development pre-let to Hachette UK.

· Agreed a new 10 year fixed term loan facility with a fixed rate payable of 2.54%pa.

1 Having stripped out the effect of the different timings of dividend payments between December 2015 and December 2016.
2 Excludes Howdens units II and III at Warth Park, Raunds.
* Each year makes reference to 31 December.

[skinny] 24/2/2017 16:48

And on past record - it shouldn't be long in coming (the fundraising).

[tyranosaurus] 24/2/2017 15:38

It can go to £1.50 but sometime in the next few months there will be another fundraising and it will sink to near NAV. What the NAV is will be discovered in the results due out soon.
Money to be made predicting the next fundraising.

[nimbo1] 24/2/2017 13:31

Its hard to find safe reliable income streams with some element of protection against inflation - so I am not surprised to see the price increasing. Of course this is a get rich slow scheme and I don't think it can go too much higher but as I could be wrong.

[cheshire man] 24/2/2017 13:15

Chart playing out nicely here :-)

[ygor706] 22/2/2017 21:13

Jonwig........you may be correct but how many industrial property companies are there around these days? Brixton and Slough used to be the only big players in the market and I'm not sure that much has changed within the UK. Overseas may be a different matter of course.

[jonwig] 22/2/2017 09:05

ygor - I have the impression that SGRO concentrates on whole industrial parks rather than widespread single units. It's been divesting itself of non-core assets. I may be quite wrong here, of course!

[ygor706] 22/2/2017 08:21

SEGRO is also on the lookout for acquisitions and is very close to achieving FTSE 100 status. Could Tritax be a potential target to get them over the line?

[shauney2] 17/2/2017 10:33

Positive results from SEGRO today.Their comments re big box logistics must be a good read across to BBOX.

'In the UK, the availability of high quality big box warehousing in core logistics locations has been particularly low and this has resulted in significant rental growth over the past two years.

The supply shortage is most apparent in London where industrial land is being lost, in particular, to infrastructure projects and residential development. The Greater London Authority issued a report during the year forecasting that one-third of London's industrial land will be lost over the next 25 years'

[steptoes yard] 14/2/2017 08:56

Warehouse assets the niche assets for me. If the others have commercial or high st properties then the experience will be mixed