Uk Commercial Property R... Share Discussion Threads

[spectoacc] 09/3/2023 11:36

Ha ha - it was. You'd think that after screwing API (or giving API the cover to screw themselves), they'd realise being miles away from the consensus isn't a way to run a REIT.

Almost as if they make the IR calls to justify the previous top-of-the-market UKCM calls - ie the increase in gearing, the Leeds hotel deal etc. "Don't worry, IR's are going back to 2.5% in a matter of months".

Still - everything has its price, & shouldn't let my dislike of UKCM rule out an investment again eventually.

[hugepants] 09/3/2023 11:24

Reckon the financial wizards at Aberdeen may have to revise their year end interest rate estimate. 2.5% was it?

[spectoacc] 09/3/2023 10:06

Interesting divergence still btwn UKCM, CTPT, PCTN recent charts, vs eg SREI, API, BCPT, CREI.

Yes, there's portfolio differences, but similarities too. I'd argue the latter ones have a fair bit of catching-down to do, with the market finally waking up to where interest rates are heading (not down). But I would say that.

[hugepants] 09/3/2023 10:01

well this is just awful. 52.5p now.

[spectoacc] 09/3/2023 09:40

If my charts are accurate, intra-day low from October was about 52.5p.

[spectoacc] 21/2/2023 14:17

Not sure it shows that valuers were wrong. The risk-free has moved significantly, that's why values have fallen so sharply. Not because rents are diving or tenants disappearing.

As per usual with REIT RNS's, even ones that seem thorough leave out a great deal.


"The leases secure £2 million of rent per annum in aggregate which, in addition to the premium over the previous passing rent, is ahead of ERV."

"Will Fulton, Fund Manager of UKCM at abrdn, said: "These latest lettings at Ventura Park have been agreed very shortly after the units became vacant at market rent significantly ahead of the previous rent paid, reflecting the strength of the market, lack of supply and strength of this location for London businesses."


So what was the premium over the passing rent, or even over ERV? Why were there no dilaps - or were there? Is there a rent-free? Assuming not, because:


"As part of the agreement, UKCM will install LED Lighting throughout the unit and an electric Variable Refrigerant Flow temperature control system in the office to improve the EPC rating from an E to a B"


UKCM would have had that CapEx to do eventually anyway, as they will elsewhere (& surprised that alone takes it from E to B), but what will it cost? If the market was as strong as they like to imply (and it is pretty strong for industrial still), you'd land the tenant with the LED lights work.


"The 29,000 sq ft Unit G&H is available to let" is slipped in at the bottom - am honestly surprised they mentioned that at all.



"Aerospace Reliance Ltd, a global supplier of aircraft maintenance materials, took occupation of the 32,000 sq ft Unit 7 on the 18 January, the day after it became vacant...".

Again - any rent-free? Why have we only just been told all of this well over a month later?


It's good news - industrial still going well - and a small net positive for UKCM that they've supposedly got an uplift in rent (depending on refurb cost above, and any rent-free or incentives, & the void time for the larger unit). But there's too much left out of such a self-congratulory RNS to do more than fall for the PR speak they want you to fall for.

[nickrl] 21/2/2023 13:51

@CWA certainly shows that good logistics space remains in demand and adds to the evidence that valueres bashed down the NAVs too much in Q4 although doubt we will see any recovery in Q1/23 it must be at least stable now with possibility of some recovery during this year if economic news continues to be positive.

[cwa1] 21/2/2023 10:32

Solid announcement:-



21 February 2023: UK Commercial Property REIT Limited ("UKCM" or the "Company") (FTSE 250, LSE: UKCM) announces that it has secured new leases on 116,200 sq ft of space comprising two units, B and 7, at its Ventura Park industrial estate in Radlett, Hertfordshire.



The units have been taken by two new occupiers following the departure of the previous tenant on 17 January 2023, with one moving in the following day, demonstrating the continued strong demand for good value, well-located industrial space. The leases secure £2 million of rent per annum in aggregate which, in addition to the premium over the previous passing rent, is ahead of ERV.



As a result of the agreements, UKCM has increased the weighted average lease term of Ventura Park from 5.75 years to 7.4 years and has taken occupancy to 94.4%. The new leases maintain UKCM's occupancy level at 98%.

[pavey ark] 15/2/2023 09:30

Have added this morning (av under 55p)Was looking to buy at 57p for a 6% yield so recent weakness was rather difficult to resist.Only REIT held having been in API,SREI and EBOX recently.There are always reasons not to buy but on balance I consider this to have enough positives to just stick it in my income portfolio and see what happens if/when the dust settles.

[cartan1blue] 13/2/2023 19:12

This thing feels pretty significantly de-risked here, no? What would have to happen to get it moving?

[skyship] 10/2/2023 09:30

UKCM looking mighty tempting. However, MACD does suggest wait for 52p.

Still, at the current offer of 54.5p the discount to Dec'22 NAV of 79.70p is now 31.6%; whilst the yield = 6.24%. Decisions, decisions...


free stock charts from uk.advfn.com

[skyship] 06/2/2023 11:05

Biggest take from that presentation is Fulton's expectation (ABRDN's !?) that Base Rate will be back down to 2.5% by the end of the year. After the API fiasco we know to be suspicious of ABRDN's interest rate projections; but hope they may be right this time around.

Actually didn't find Fulton's Scottish accent a problem. You should tune into PMQs (midday wednesdays) and hear the appalling accents from most of the SNP MPs - sometimes impossible to know what they are trying to say.

[pavey ark] 06/2/2023 09:40

nickrl, I tried to listen to it but that accent is absolutely horrendous...I may return and look at the slides.

Andrew Neil, Kirsty Wark, Andrew Marr even Laura Kuenssberg fine but this guy is almost stomach turning.....portfolioooooooo!!

In Scotland , especially Glasgow /west of Scotland it is known as pan loaf/ Kelvinside (you can catch bits it in Kuenssberg and Wark but not in Kirsty Young)

Trust me this guy sound to me like the Scottish equivalent of Brian Sewell......yes that bad !!

Was looking at UKCM but now not sure.

[nickrl] 03/2/2023 22:01

quoted data have an interview with mgr

hxxps://quoteddata.com/research/interview-fulton-uk-commercial-property-reit/

he infers may make sales rather than load up the RCF too much

[hindsight] 01/2/2023 13:56

nickri, was referring to todays -10%

[skyship] 01/2/2023 13:32

Valuation falls have been based entirely upon interest rate considerations. The recent freeze on transactions hasn't obliged valuers to consider the realities of the Market, where development potential and rental yields impact on property pricing.

Accordingly, as transactions return, valuers may well have to rethink their rather OTT red ink. I now expect Q1'23 to show positive NAV moves.

[nickrl] 01/2/2023 13:07

@hindsight it must have been as sp's were showing discounts of 30-40% across the majority.

[hindsight] 01/2/2023 12:21

I was under the gemeral impression us posters were expecting 20/25% asset price falls from the CBRE data, gearing on top. Appears the market clearly wasnt

[adae] 01/2/2023 11:38

All of that fall is on interest rates - if those peak lower than expected, or fall sooner, some of that NAV can be 'returned'.

And the opposite, I acknowledge.

[spooky] 01/2/2023 11:34

NAV 112.9 in June, 79.7 in December. Thats a fall of almost 30% in 6 months. Hmmmm.

[nickrl] 01/2/2023 11:30

10% of property was EPC E 12mths ago so i will see what they report in the 22 report but they are pretty good shape in the short term.

@specto they are stooges of Phoenix Life at the end of the day so don't want to answer to anyone else. Plenty of other reits have been evasive of my questions on investor meet or other online presentations. Mind you Sinclair came back to me personally when i raised an enquiry with PCA which was a master of spin.

[spectoacc] 01/2/2023 11:13

@giltedge1 - re the Leeds hotel, I tried repeatedly to speak with them about it at the time, and found them incredibly arrogant and unhelpful. Contrast that with eg CTPT, or EPIC, or indeed most of the small REITs.

What I wanted to know was - why were they committing such large sums to a t/o rent, what was even a very approx estimate of the return/yield, were they aware of the status of "south of the station" in Leeds CC, how were they funding it, and what would happen if costs increased with the build time being so long - an unexpectedly pertinent question, considering what's happened since.

They wanted the questions in an email instead, which I did.

They then answered almost none of them, beyond telling me that Will Fulton was familiar with Leeds, so not to worry about the location. And today we see that the funds are indeed coming from borrowing.

Let's see if it they get it completed on schedule in Q2 2024, what the economy looks like then, what their LTV looks like because of it, and what the total cost has been.

It might work - but it felt completely the wrong time to be doing it, and the wrong price. I'd say both of those with bells on now.

[skyship] 01/2/2023 11:07

ghhghh - "Not much else to buy at the moment"

As a matter of interest, which REITs (other than EPIC & UKCM) do you now hold?