Urban Logistics Reit Share Discussion Threads

[skinny] 11/11/2022 08:45

It seems the market agrees!

[spectoacc] 11/11/2022 07:35

Reads pretty well on everything - debt, NAV (-3%), LTV, collection.

[giltedge1] 30/10/2022 16:17

Shares fell back on friday, I assume due to Amazon comments. But Amazon not even a top 10 Tenant. As far as I can tell top tenants, logistics companies for storage/e-Commerce.

[giltedge1] 27/10/2022 10:20

This has been a great short term trade opportunity, been giving away when in low 120's, when you factor in falling Gilts tail wind, still good up to £1.50.

[scruff1] 26/10/2022 09:26

No skinny I knew that - it was good. But I thought it would be nice to search out a few positives in these miserable times. I gleaned them from an article posted some time ago by Williamcooper over on BBOX

[skinny] 26/10/2022 09:05

Scruff - I actually posted "any negatives?" - it was an attempt at humour - I'll get me coat.....

[scruff1] 26/10/2022 09:02

Skinny - any more negatives? No doubt but there are positives. Demand for warehousing isnt weakening - albeit for different reasons. Due to increased costs(and other reasons) fewer are being built which gives added value to existing quality facilities. Also since the shock caused to the 'just in time' strategy caused by covid there is a move to build up supply security which is creating demand for more local storage. This is enhanced by the Russian problems, uncertainty in China and the costs of transport. On top of which bad as it is I dont see any decrease in the number of Prime, Parcel Force, DPD etc vans on the road. The sheds story is far from over. Its just taking a breather

[lefrene] 25/10/2022 17:15

Jonwig, to be fair it is a case of horses for courses, it all depends on what sort of entity is involved. The type most likely to need warehousing in a world of constrained deliveries, would be manufacturers of complex products who need to have a flow of widgets to their production lines. That type of operation will be looking for different suppliers from more reliable sources, and most likely would have to batch order to get a decent price. Those batches would need to be warehoused in such a way that they can be easily drawn down to feed production.

Consumer goods retailers though, I would expect to simply sell things as they turn up, and not wish to store things in hope of future demand. Although of course each sector has it's own requirements. 'Fresh' foods grown on a seasonal basis in the UK are for instance stored for considerable periods in temperature controlled warehouses, and often get moved about to cheaper storage locations if they arise. Sometimes for suprisingly smalll savings, eg, I have moved 24 tons of potatoes 160 miles, just for the customer to save £100!

SHED are carving a niche in a very good sector, not only offering short term storage, but also enabling that household jit experience. Such that I suspect they command a premium, over other warehousing operators, and perhaps offer, or could offer, other complimentary services. The better off will happily pay a premium for convenience, and quite possibly if things get really bad, there could well be a 'status' in being able to afford home delivery?

[jonwig] 25/10/2022 15:48

lefrene - point accepted. Of course in a bad enough recession, there won't be a need for high stock levels.

[lefrene] 25/10/2022 15:04

jonwig, "retailers will need to hold extra inventory". I doubt it, as just about everything arrives in a container and is promptly sold. JIT doesn't really work if your supplier is unable to churn out goods rapidly. The boxes at the suppliers end become the warehouses.

As an example go check out a DFS store. The boxes arrive at the back of the store, and their contents go straight into delivery vans, and out of the gate. I was surprised to see that the Maidstone DFS took and delivered the contents of 4 40' boxes per day. If the boxes don't arrive, then the vans don't get filled, but there won't be any need to warehouse anything.


When you open one of those DFS boxes you have to stand well back, the leather furniture is still curing on it's journey, and the chemicals used need to escape from the box before anyone can enter it.

[giltedge1] 25/10/2022 14:56

Yes great day, (didn't buy enough as usual), shows share price very sensitive to interest rates, in a good way this time. All shed/e-commerce type property shares doing well.

[skinny] 25/10/2022 14:48

SHED leading the sheds on a decent day so far.

[spectoacc] 25/10/2022 13:36

You can build sheds.

[giltedge1] 25/10/2022 12:23

Good update, confirms storage & e-commerce place to be. 6% yield great compared to Gilts 3.73%, for a whobbly Govt Gilt, prefer the Sheds?, as more tangible & you cannot print more Sheds. Have lost track of gearing as many changes, Capital Raising, Drawdowns etc, anyone up to speed?.

[thamestrader] 25/10/2022 09:59

Made a modest top-up.

[spectoacc] 25/10/2022 09:08

Fund manager cash holdings at highest level since 2001 apparently, but for once I think they're right.

Also worth recalling the 2000-03 bear market..

[jonwig] 25/10/2022 09:04

Skinny -

Striking Brits - need more stock to be on the safe side - need more space to store - shedloads, in fact.

[skinny] 25/10/2022 08:56

Very true jonwig - as long as they can source them and get the goods through our striking docks!

scruff - (539) any negatives..... :-)

[scruff1] 25/10/2022 08:54

nimbo
Its been on my mind a while. There is/is going to be a lot of cash being held back - as you and no doubt all of us are very wary during current conditions. But at some point I reckon that cash will create a tsunami as it floods back onto the market. I just pray Im riding the crest when it does - if Im still alive :-)

[nimbo1] 25/10/2022 08:44

I bought a few first thing, I used to have a large holding here. Hard to justify buying much at the moment but everyone knows that!

[jonwig] 25/10/2022 08:43

scruff - it looks likely that supplies of goods from China will bemore unreliable (still in lockdown) and politically fraught. This could mean retailers and just about every other firm will need to hold extra inventory - "Just-in-Time" is no longer an option.

Lots more sheds, then!

[scruff1] 25/10/2022 08:35

The right discount rate. A job for einstein and mystic meg at the moment - a new PM, Bailey at the BoE, energy prices, horrendous business conditions, a barmstick in Russia, China going pear shaped

[jonwig] 25/10/2022 08:24

nimbo - the NAV will be revalued down by the independent property valuers, I'm sure. But their ways are full of mystery. I don't think they use a discount rate in any explicit way, though raised gilt yields will be a headwind.

The dividend yield is now above gilts (30yr I think), and that is falling.

Segro's recent trading update was equally positive, but they did make one remark in passing:

"We note that CBRE UK Monthly Property Index has shown a 10 per cent decline in UK industrial values during Q3."
They didn't think that was worth further comment!