Uk Commercial Property R... Share Discussion Threads

[skyship] 29/4/2013 12:21

Banj - take a look at the CP+ thread.



There have still been some good plays this year; though slower than 2009/12. CIC has provided a rapid 25% for a few follower; and APT and PCTN have been two other useful plays. The charts in the Header reveal other successes whilst also showing perhaps better to trade the swings rather than buy & hold.

Slightly speculative, but could be a profitable trade over Wednesday's Prelims, is Development Securities (DSC). George Soros' Quantum Partners recently bought a 5.7% holding. NAV discount = 40%. They were a week market on Friday however, so who knows...

[britishb] 29/4/2013 10:43

FCRE offers a slight better than covered yield of c 7.1%. Higher gearing (near 50% LTV from memory) so a bit more risk.

NOt very exciting any of them. I only hold in case we have a Cyprus moment!

[banj] 29/4/2013 10:26

Thanks guys, I must admit I am new to this investment area but thinking why invest directly in commercial properties thru a sipp when invested here can yield + 5.5% to 7% with risk diversified. Seems a no brainer really.

If you can spare a couple of mins may I request some other companies you favour even more than ukcm?? And why. I accept that I am responsible for doing my own research and appreciate anything you can offer.

My aim is as hh says, a safe-ish play in a low yield world albeit a higher than normal yield with chance for capital growth as the economy improves. Obviously a london focused portfolio seems to offer more robust prospects than the rest of our country atm.

thank you :-)

[haughtonhoney] 29/4/2013 08:57

It's a safe-ish play in a low yield world....

[britishb] 29/4/2013 08:54

I'd say you're pretty close to the mark SKYSHIP. No idea why these trusts have been paying uncovered divis for so long. Most are now reset. UKCM more likely to continue at current rate given very low gearing/ prop dev stuff ongoing etc but anybody's guess.

[skyship] 29/4/2013 08:19

Banj - your answer is in his wording:

"..could pay a covered dividend yielding about 6% (by my calcs).."

The current dividend is NOT covered. Bizarre that they haven't yet reset it to a covered level; but I would expect them to do so this year. The current dividend of 5.25p is covered just 85% by EPRA EPS, in spite of a 9% earnings growth.

I suspect they will reduce to 4p/annum, so providing a dividend with 10% cover and a current yield @ 73p of 5.5%.

[banj] 28/4/2013 20:25

britishb, why 6% by your calcs, not 7%+? tia..

[britishb] 26/4/2013 11:24

You say "obviously overvalued" Skyship but UK 10 yr gilts yield 1.7%. In that context a very lightly geared property play which could pay a covered dividend yielding about 6% (by my calcs) is arguably not obviously overvalued!

The NAV is just a property valuers opinion (same lot who were "valuing" com prop so much higher a few years ago!). The cash flow is real. NAV will be down because of lack of finance to invest in com prop in current climate etc.

You were calling a sell on IRP recently because div wasn't covered but I calculated covered div would be 10% at that time. Once again I cleaned up.

Forget NAV and look at cash flow IMO!

[skyship] 26/4/2013 06:29

At 73.5p the shares offer an uncovered yield of 7.1% and a 5.7% premium to the underlying NAV!

Obviously over-valued; but unlikely to fall far below 70p as this is a stock controlled by institutions rather than PIs.

[skyship] 26/4/2013 06:25

Highlights

-- NAV per share* as at 31 March 2013 was 68.6p (31 December 2012: 69.6p), a fall of 1.4%;

-- The portfolio is now valued at GBP1,003.6million. This represents a like-for-like decrease of 0.7% in the quarter before capital expenditure, in line with the IPD Monthly Index and primarily driven by capital value falls in the Company's shopping centre and Rest of UK High Street retail exposure;

-- Void rate remained broadly flat at 5.0% as at 31 March 2013, significantly below that of the 9.9% benchmark;

-- The Company intends to declare a first interim dividend, in respect of the period from 1 January to 31 March 2013, of 1.3125p per Ordinary Share, with ex-dividend and payment dates of 8 May 2013 and 31 May 2013 respectively.

[cwa1] 26/4/2013 06:21

First Interim Dividend for 2013

UK Commercial Property Trust Limited today announces its first interim dividend payment, in respect of the financial period from 1 January to 31 March 2013, of 1.3125 pence per share as per the schedule below.
Ex-Dividend Date - 8 May 2013
Record Date - 10 May 2013
Pay Date - 31 May 2013

[cwa1] 26/4/2013 06:20

Christopher Hill, Chairman of UKCPT, commented:

"The first quarter of 2013 saw a slight reduction in portfolio valuation, again largely driven by weakness in values within our retail holdings outside London. However, the stronger performance of our London retail assets and good progress in our asset management initiatives elsewhere in the portfolio offer reasons to be more optimistic about the outlook for the year. Broader economic indicators are beginning to show signs of gradual improvement, and we are confident that, with the high quality of our portfolio and the skills of our specialist asset management team, we are well positioned to benefit from any improvement in the market."

Slight signs of room for enthusiasm then?

[rcturner2] 18/4/2013 15:55

Seems to be holding up reasonably well here.

[jonwig] 23/3/2013 10:09

Net cash income for 2012 was £53.6m, which is a slight improvement from 2011's £52.7m.
But, the dividend costs them £63m.

They talk well about their policy of "enhancing dividend cover", but they really should state explicitly that the dividend is uncovered and why they continue to maintain it.

[cwa1] 20/3/2013 07:21

Finals out today:-

Commenting on the results, Christopher Hill, Chairman of UKCPT, said:
"The Board believes that UKCPT is well placed to achieve its objectives by undertaking proactive asset management initiatives to preserve and improve income. The Company has considerable cash resources which can be utilised for income enhancing acquisitions or asset management opportunities. The portfolio is of a prime nature and has a strong and well diversified tenant base which offers the potential for additional income generation. In a low interest rate environment, these factors should ensure that the Company remains an attractive proposition for investors."
Robert Boag,Senior Investment Director at Ignis Asset Mangement (UKCPT's Asset Manager) added:
"2012 saw continued challenges in the broader economy, further emphasising the importance of asset management in preserving and growing income and values. We believe that the overall quality of the portfolio and our ability to identify income enhancing initiatives, even in a market with selective occupier demand, offers solid prospects for future income and capital growth."
"The Company's strong balance sheet gives the opportunity to identify suitable acquisitions, similar to those made in 2012, in a market which continues to be characterised by deleveraging. We will continue to commit capital to sound, income producing assets which offer the potential for implementing asset management initiatives which will support dividend cover. Overall, in the current economic environment, the Company is well placed for the future."

[trustman] 21/2/2013 07:34

Might rerate a bit if they followed Picton and paid a covered dividend rebasing for the future

[jonwig] 11/2/2013 14:45

They've just sold a Glasgow property for £10.5m - no mean amount, but no RNS:



Some general info on UKCM in the above, too.

[cwa1] 25/1/2013 09:56

Just had a small nibble to join you lot here. Good fortune with it all.

[hugepants] 05/12/2012 15:51

deepvalueinvestor, what other trusts do you hold? The only other one I have in size is Merchants Trust (MRCH) which is yielding about 6%.

[deepvalueinvestor] 04/12/2012 20:56

84% covered dividend but lots of cash available to pay. A bit more interesting at 65p and paying a 8% divi. Total return of 6% in 2013 and then hopefully some growth in NAV thereafter?

[hugepants] 06/11/2012 16:48

yep Ive a few SREI and PCTN.

[alanji] 06/11/2012 14:46

Hugepants - I reckon the dividend is covered. Downside is the small discount to nav.
Have you looked at SREI yield 9%(should be covered now or very shortly - interims due 20 Nov) discount 28%, ltv 36%

[hugepants] 06/11/2012 12:48

Bought few of these. Goes ex-dividend in about a week. Yielding 7.8% at this price. Is it completely covered though? Gearing only 18.5% which is good.



last results:

"Fall in NAV per share to 72.3p as at 30 June 2012 (31 December 2011 - 75.5p) mainly caused by 2.4% like-for-like decline in value of property portfolio;

Share price total return of 5.9% in the period;

Over five years NAV and Share price total return exceed IPD benchmark and FTSE Real Estate Investment Trusts Index;

Lowest gearing in the Company's peer group at 18.5% and blended average debt rate of 4%;

Attractive annual dividend yield of 7.4% based on period end share price."

[holts] 11/4/2012 07:37

as phoenix held 62% that may improve marketability a little

[topvest] 05/4/2012 16:09

I don't quite understand the Phoenix Life move of placing 4% at 69p which is quite a discount. Doesn't look a great move by Phoenix Life, albeit they are reducing debt so maybe thought it was worth some discount. Bodes the question whether any more sales are expected?