Unite Share Discussion Threads

[redalert] 02/3/2020 11:42

gsw- only thing i can see is potential risk to their summer income re covid, as stated in the results statement. RA

[gswredland] 28/2/2020 17:21

Can really see a lot not to like here. Immune to covid?

[maddox] 19/2/2020 14:10

With the completion of the takeover of Liberty Living on 29 Nov an additional 72,6 million Unite shares were admitted to the stock market. This has thus lifted the market capitalisation significantly (Mkt cap on 16 Nov19 was £3.41bn (sp 1176p) on 7 Dec 19 mkt cap £4.49bn (sp 1234p). A279;This together with the subsequent share price appreciation has led Unite's market capitalisation to rise to £4,84bn currently - where it is knocking on the door of the FT100 index. The next quarterly review of the FT100 constituents will take place on the 11 March - so just three weeks away. As things currently stand Unite is larger than the bottom nine firms in the FT100 but ranks 6th from the top of the FTSE 250 index. So promotion is far from certain and Unite may just fall short and end up on the FT100 Reserve List. On the other hand we may see a run-up in the share price as Financial Institutions position themselves to take advantage ahead of the Tracker Funds. Anyway nice to have a nag in this derby! Regards, Maddox

[ben gunn] 06/2/2020 19:36

Thanks Maddox...I have filed away the Chronic Investor piece. Considering a long position for the run up to the 26th Feb results and new divi declaration.

[ben gunn] 12/12/2019 16:03

Nice pre-election results price weakness this afternoon. Would top up but really fully exposed Maddox- going back to your point a couple of months ago that private investors seem shy of this stock, I have raised it with colleagues at the Society of Technical Analysts and they seem to blank it too, Seems very odd as I see lots of headroom for the price as well as excellent trends over the last few quarters.

[jonut] 03/12/2019 10:30

From Liberty Living website, www.libertyliving.co.uk/corporate-info/, details of their UK wide portfolio, average 400-600 beds/site (London & Glasgow 300). Total 51 sites/ ~24,000 beds. Location/Residences Aberdeen/4 Bedford/1 Birmingham/4 Bristol/1 Cardiff/8 Coventry/2 Edinburgh/1 Glasgow/2 Leeds/2 Leicester/2 Liverpool/4 London/5 Manchester/5 Medway/1 Newcastle/4 Nottingham/1 Sheffield/1 Southampton/2 Wolverhampton/1 I imagine a fair few sites will be surplus to requirements and 2020 will see the beginning of Unite rationalising it's expanded estate, using the funds to increase it's offering in preferred locations. Interesting year in prospect.

[maddox] 26/11/2019 22:33

Hi arja, Yes too true, I know of similar sad cases. Regards Maddox

[maddox] 24/11/2019 15:57

Hi andytr, Unfortunately Theresa May did significant damage to the UK as a destination for foreign students first as Home Secretary then as PM. She is deeply xenophobic and foreign students were an easy target in her attempt to get immigration numbers down. Several legitimate students from India were deported on the eve of their third year - they'd already spent a considerable amount on their first two years! Un-fair and unforgivable treatment that had a predictable effect on Indian students coming to the UK. Thankfully, she's gone and there is recognition of the huge contribution this sector makes to the economy, our intellectual capital and soft power around the Globe. The target is to grow foreign student numbers by 30% by 2030 - see my post 595 above. 2018/19 figs are that non-EU student numbers were up 8% and even EU students were up 1%. So far healthier numbers and of course they are just part of the market. Applications from 18-year-olds for uni places are at an all-time high. Also, more second and third-year students are opting to stay in purpose built student accommodation. So, whilst I see your point if anything we are in a better position now than we have been for many years. Regards, Maddox

[andytr] 20/11/2019 11:57

The UK’s population of international students is growing the slowest of any large country – up 0.6% in 2015 and 0.3% in 2016. Despite government promises, the UK's increasingly inward policies cause reputational damage, making it tricky to see long term growth potential. Unfortunately I'll have to bow out.

[maddox] 08/11/2019 16:23

I've been waiting for the CMA to sign-off on the takeover of Liberty Living. Now received, this is a huge step forward for Unite - the number one in the market taking over the number three. It consolidates Unite's position as the market leader and delivers a significant operational scale-up and with it the prospects of efficiency gains. What I was somewhat surprised by was the quality of the Liberty Living property portfolio, focused similarly to Unite, on top-flight universities and how good the fit is with Unite's own portfolio. There is certainly no drop in quality as a result of this takeover. One aspect where Liberty were performing better than Unite is half-term lets - filling vacant rooms when the students are at home or on holiday. So there may be a few learning points to be taken on board along with the portfolio. The deal also brings Liberty's owner, Canada Pension Plan Investment Board ("CPPIB"), on-board as an investor. It is having deep-pocketed long-term strategic investors that gives Unite the fire-power for similar large deals. This is a huge differentiator from the other purpose-built student accommodation (PBSA)specialist developers and managers. So a fantastic deal in a market that still exhibits positive demand and rental growth. This set against an increasingly worrying macro-economic back-drop. The un-correlated nature of this sector of the property market is a highly attractive characteristic. If, as seems possible, the Treasury feels the need to drop interest rates - our asset-backed cash machine will look ever more a safe haven for financial institutions' money. Needless to say my Dec 2020 share price target of 1035p has been passed a year early (1135p as I post). So congratulations to all holders and I'm looking forwards to see how the portfolio integration proceeds and additional value is generated. Regards Maddox

[maddox] 13/9/2019 09:57

The Govt now is aiming to increase the number of International Students to 600k from the current 450k over the next 10 years. hTTps://www.theguardian.com/politics/2019/sep/11/uk-work-visas-for-foreign-students-all-you-need-to-know On the basis that PBSA beds are being built at a rate of 25,000 per year - and UK demand is still rising - it appears that the under-supply that supports rental growth is likely to be maintained. Regards, Maddox

[jonut] 11/9/2019 15:13

Very reassuring update today, topped up to full weight on the strength of it. Intended to take a trading stake around £10 anyway but will probably keep them tucked away long term. Thanks for the posts Maddox - always of interest. Well kept secret, this board.

[maddox] 11/9/2019 12:33

Unite report strong demand in their trading update today should deliver on-target rental growth. The Competition and Markets Authority have started their investigation into their £1.4bn acquisition of Liberty Living. This takeover is the number one in the PBSA sector taking over the number three. However, the market is far larger than the PSBA Sector and includes University-owned accommodation and also large number of HMOs(home of multiple occupation). The review is expected to report in 4Q 2019. Regards, Maddox

[maddox] 11/9/2019 11:45

Excellent news today for all UK Universities and Purpose-Built Student Accommodation (PBSA) providers. The Govt is to change the rules to now allow foreign students studying in the UK to stay-on work for a further two years unrestricted. There are currently 450k international students in the UK. This move will undoubtedly boost numbers as the UK has been far less attractive than other top destinations, specifically Australia and US that already allow students to stay-on to work. This thankfully reverses the disastrous bone-headed approach introduced by Theresa May as Home Secretary to require students to leave after 4 months. May saw students as a soft target to hit her hopeless immigration targets - despite the hard evidence that very few were over-stayers. This move applies to all trusted higher education providers and will thus exclude the dodgy language schools that were flouting the immigration rules. hTTps://www.bbc.co.uk/news/uk-49655719 Regards, Maddox

[bothdavis] 18/8/2019 11:55

BBC reports over 364,000 A-level students flood clearing.

[maddox] 12/7/2019 12:00

Hi Ben, Certainly, nothing I like better. Where are you based? I'm based in London and often at Mello events, ShareSoc, Stockopedia Stockslams, Proactive and the like... it's more a personal stream of consciousness that a BB - lol. Best regards Maddox

[ben gunn] 12/7/2019 00:05

Maddox, you really do make this site work. Thank you I have pushed my wife and kids portfolios into about 10% Unite. It continues to tick all the boxes for rising cash flows, rising sales and strong balance sheet. This is not the place to do it but I should be delighted to show you how my holistic company valuation process indicates significant price headroom even before the new deal. Do you fancy a jar and discussion one evening? Yours, Ben

[maddox] 11/7/2019 11:10

A few select quotes from the Guardian today..... 'Applications from Chinese students to study at UK universities have gone up 30% since last year' 'The Ucas figures also revealed an increase in the number of British 18-year-olds applying for places, up 1% on last year to 275,520 despite a 1.9% fall in the overall 18-year-old population of the UK. EU applicants have also risen 1%, to 50,650 despite the Brexit uncertainty, and Ucas reported a record number of applicants from outside the EU at 81,340, an increase of 8%.' hTTps://www.theguardian.com/education/2019/jul/11/chinese-students-applications-to-uk-universities-up-by-30 Market fundamentals appear strong, and this also highlights the defensive nature of this sub-sector of the property market. I wonder whether Fergal O’Reilly of EY will be revising and re-issuing their report? Regards Maddox

[maddox] 01/7/2019 10:01

The A1 Alpha student property scheme - I looked at it and didn't like the risk involved. it had all the characteristics of the investments scams of old, a plausible story, far too optimistic projections (an 8% yield) - I filed it along with the building land plot scam, wine investments and ostrich eggs fiasco. I don't think it has any bearing on the real PSBA Sector. Regards, Maddox

[maddox] 01/7/2019 09:39

Hi jonwig, Thanks for raising these issues, which arn't of concern having looked into them. The proposal by the Mayor of London is that student accommodation will need planning proposals to have a university sponsorship. This really plays to Unite's strengths as this is the approach Unite has been taking and thus already has long established uni-relationships. Sixty per cent and rising of Unite's accommodation is pre-allocated to university for their first year and foreign students (termed 'nomination agreements') that have been promised in-hall accommodation. This is an advantage for Unite against Financial Institutional funded speculative development, ESP and DIGS. EY wrote a report Dec 2016 stating that the sky was going to fall in on the PSBA sector. Essentially, it argued that student numbers are in decline due to demographics. It's a classic consultants ploy to drum up work to create fud (fear, uncertainty and doubt). I used to be a strategy consultant so I recognise the tactics. Can't find an online link for it or on EY's web site? I have a copy if you send me an email [e-mail]. Suffice to say the report's predictions are not proving to be correct. Whilst of course the demographic decline is real enough it has been more than off-set by: 1. Proportionately more of those 17/18 year olds opting to go to university; 2. More foreign students coming to he UK; and 3. More second and third year students opting to stay in-hall. EY chose to ignore the potential for points 1 and 3 in what is a chronically under-supplied market. Regards, Maddox

[jonwig] 29/6/2019 11:35

Hi, Maddox. I posted this on the ESP thread. Again not directly relevant to UTG: ~~~~~~~~~~~~~~~~~~~~~~~~~~ Not directly relevant to ESP (or DIGS) but ... "More than 1,000 investors have been hit by the collapse of a company behind a £100m property scheme that aggressively marketed UK student accommodation on Facebook." https://www.ft.com/content/1db98d5c-98c5-11e9-9573-ee5cbb98ed36 Includes this: A report by EY, the accounting firm, warned in 2017 that provision of student accommodation may have reached saturation point in some local markets. “The number of UK students available to fill private sector beds has declined,” said Fergal O’Reilly, an EY partner. ~~~~~~~~~~~~~~~~~~~~~~~~~ I sold one-third of my DIGS shares when they had a rather unsuccessful fundraising recently. Their own fault: they wanted too high a price. The Mayor of London also has some plans for controlling student rents and making a proportion of every development 'affordable'.