Watkin Jones Share Discussion Threads

[gswredland] 26/10/2017 16:50

Yes thanks Rivaldo.

[minerve] 26/10/2017 14:23

Thanks again rivaldo. Good stuff.

[rivaldo] 26/10/2017 13:19

Cheers jg, appreciated.

More news today:



"Plans in for 12-storey Belfast scheme
26 Oct 2017  Ireland

Revised plans to build a 12-storey residential scheme in Belfast city centre, which could create 160 jobs and would represent a £20m investment, have been submitted.

Lacuna Developments and Watkin Jones Group acquired 26-44 Little Patrick Street in July, with the site currently holding permission for 354 student studios.

The pair immediately set about drawing up new proposals for the area, with an institutional investor to forward fund the amended plans having been secured.

Now, the application has been submitted. It states that the new project, which would comprise 430 rooms, is "a more efficient and sustainable use of the land" which "reflects the applicant's experience of developing and operating similar schemes elsewhere".

It would cover 147,000 sq ft of space and include common areas, a reception, a quiet study area, an external courtyard and 100 bike spaces.

A planning statement drawn up by Turley outlines the economic impact the revised application could have including creating 160 jobs and supporting a further 54 roles. The development would also represent an investment of £20m.

"The need for student accommodation of this kind still remains and in particular, market experience indicates a strong need for a mix of accommodation to be provided," it read.

"The development will ensure the redevelopment of the site by a company which is committed to delivery in Belfast, as is evident from other operational schemes."

At the time the deal was announced, Anthony Best, managing director of Lacuna Developments, touched on the need for projects.

"In September 2019, the completion of the Ulster University campus will bring 15,000 more students and staff to this area of Belfast," he said. "The revised plans for Little Patrick Street will contribute less than 1 per cent of the accommodation required.

"Through our experiences with John Bell House, Dublin Road and Athletic Stores, we have built up our understanding of the student market and demand in Belfast. Our changes to the scheme will provide the right mix of studio and cluster bedrooms to meet demand from the market."

[skinny] 11/10/2017 09:04

A strong start - albeit on small volume.

[jg88721] 10/10/2017 19:55

big thanks to Rivaldo for some good posts (jonwig too). great you share your finds and insights with us so freely. I never spent much time researching WJG or the industry - I'm a very content and relaxed holder, and very happy just reading the company RNSs - so your posts save me time and are appreciated.

[minerve] 10/10/2017 17:21

Thanks jonwig - I appreciate your introduction to the REITs in this sector. I have New River as a REIT and appreciate its dividends and defensive qualities.

My daughter started university last year and over the last year or so I have visited and toured many. The amount being raised and spent by them is immense. For example, Cardiff University raised £300m via a bond issue not long ago and their development using these funds is impressive. Many universities are the same. There is no question that the competition between universities is becoming more intense each year and their focus as businesses - rather than just academic institutions - is pertinent to many of them remaining in existence.

This money eventually, either directly or indirectly, supports new student accomodation and as the university business plans develop many will see opportunities to steal revenue from private landlords that are normally the domain for the years after the first year of study.

On the opposite side of the equation you have many institutions/sovereign funds etc.. looking for stable assets that provide stable income over the longterm. The likes of Legal and General are attracted to assets like this. National Grid sold some of its assets to sovereign wealth funds which to some extent shows the attraction of UK stable incoming generating assets. They are only going to get more attractive into the future if the £ remains 'cheap'. The article above again refers to foreign interest. Eventually, if the status quo remains I am convinced some universities will go out of business or be forced to somehow merge, sadly. This could be a decade or so down the road. The stakes are becoming too high and the leveraging is increasing daily.

But I am here to make money and at the moment I see opportunity that seemingly will last into the medium-term.

I guess you know all this already. But there we go.....

[jonwig] 10/10/2017 17:00

Minerve - there are three REITs in the sector: UTG (largest, also develops own assets), DIGS (specialist, mostly London), and ESP (widespread). DIGS trades at a premium to NAV whilst UTG has, I think, a developer's discount. ESP has met some problems, one of which is the unforced error of paying an uncovered dividend. From this level, it might have decent recovery potential.

I don't think any of the three have used WJG for construction.

[minerve] 10/10/2017 16:06

Shame about the REIT. I will look into that though. I like the structure of REITS as an investor.

[minerve] 10/10/2017 16:01

Yes. Thanks.

I am confident here to increase my holding today. Famous last words.......:)

[jonwig] 10/10/2017 15:44

Thanks for article, rivaldo! It mentions ESP (Empiric Student Properties, a REIT) which is making a real Horlicks of its business plan. Share price at a nav discount, which shouldn't be happening in this sector.

[skinny] 10/10/2017 15:05

New high @224.50p

[rivaldo] 10/10/2017 11:05

Interesting background on the strength in the UK student housing sector, with a mention for WJG's sale to Europa:



Conclusion:

"'Demand remains strong from all types of investor and we expect to see further consolidation between the larger platforms driven by a strong desire to drive operational efficiencies and brand awareness through wider market coverage. Q4 will see two major student platforms, Curlew (guided at £600 mln) and Pure (£800 mln) coming to market.

'Given the continued lack of opportunities in the student sector, we expect to see the distinction with the private rented sector becoming more blurred. This could mean the increase of co-living blocks, best practice from student operating models transferring into the Build to Rent sector, or C3 residential schemes increasingly being let to students.'"

[santangello] 03/10/2017 07:18

Agree entirely Rivaldo.....wonderful stuff.

[rivaldo] 03/10/2017 07:14

Terrific stuff, with two big forward sales for £66m:



So impressive that all forward sales for 2017, 2018 and already almost 75% of 2019's have now been delivered. The markets just love such forward visibility.

Beautiful.

[santangello] 03/10/2017 07:07

More positive and outstanding newsflow this a.mFuture growth being underpinned with almost every announcement.......fuelling capital and income growth for investors.Continued well done to The Board of this gem of a company.

[skinny] 02/10/2017 11:24

Thanks Jonwig - playing catch up after a break.

[jonwig] 02/10/2017 11:20

Skinny - discussion here:



Generally not favoured.

[skinny] 02/10/2017 11:06

Any views?

[its the oxman] 02/10/2017 10:43

May need a bit of newsflow but 250p is calling us.

[gswredland] 29/9/2017 16:17

Decent breakout coming?

[woodcutter] 29/9/2017 14:51

rather late to the party nonetheless taken a position today, decent weeks volume on the breakout

woody

[rivaldo] 27/9/2017 07:43

Peel Hunt have today increased their target price to 230p (from 225p) and say Buy:

[rivaldo] 19/9/2017 13:45

Nice PR:



"Watkin Jones shares trading at double launch price
18 Sep 2017, 10:30

Shares in the Bangor-based student accommodation developer are changing hands at more than twice their debut price 18 months ago.

In March 2016, shares in the group entered the London Stock Exchange at 100p. Last week they finished on 212p and opened today at 214p, showing no sign of stopping their climb.

Analysts and investors were guests at a visit to one of Watkin Jones’ London sites earlier this month as part of the group’s investor relations campaign.

Since June, analysts including Peel Hunt, Jefferies Group and Beaufort securities have issued ‘buy’ ratings for the stock, with target prices up to 250p.

The rising price means the business is now worth more than £540m, compared to a £225m valuation when it entered the stockmarket.

Since 1999 the company has delivered more than 31,000 students beds at around 100 projects."

[quepassa] 14/9/2017 17:00

Important, well written and well researched article in today's Guardian about PRS/BTR - Private Rental Sector aka Build-To-Rent

I didn't know that even the blue-blooded Grosvenor Estate/Duke of Westminster is now getting involved in this sector such is its attraction.

If WJG put the pedal to the metal in this burgeoning sector and go flat out, great things can and will happen.

The Guardian article (freebie-no Paywall) is headed:

"Build-to-rent – the solution to Britain's housing crisis?
Purpose-built block of rental homes, including affordable units and extensive facilities, are fast becoming a hot investment".

herewith link:

hXXps://www.theguardian.com/business/2017/sep/14/build-to-rent-the-solution-to-britains-housing-crisis


ALL IMO. DYOR.
QP

[mrnumpty] 13/9/2017 11:12

Competition , from page 4 of the Business section of the Daily Telegraph ( Wednesday 13/9/2017 ) , entitled " Empiric expands to attract older students as revenue leaps 27pc " , by Rhiannon Bury . " Empiric Student Property is planning to increase its accommodation provision for second and third year students as rental markets across the country remain squeezed . Paul Hadaway , the chief executive , said the firm was keen to buy up blocks that could house students outside of the traditional first-year cohort which it has typically targeted . " We definitely see our future as a greater offer to postgraduate , second and third years " , he said . In July , the business raised £ 110m of equity to buy four more buildings . Mr. Hadaway said that Empiric , which has 90 buildings in 30 towns and cities , was seeking to encourage existing tenants to move within its portfolio , even if they moved city while studying . Earlier this month , the company announced that its property operating arm , which is called Hello Student , had signed a deal with renowned interior design brand Conran Shop to fit out luxury rooms in certain locations . It has so far fitted out 18 rooms in Cardiff and Glasgow with the high-end designs . Empiric's results for the six months to June 30 , which were released yesterday , showed that the value of its portfolio had jumped 13.4pc to £ 817.9m as a result of the purchases , although net asset value per share , which property companies use to record value , was almost flat at around 105.8p . Revenues for the firm jumped 27.3pc to £24.5m . The otherwise upbeat results were dented by some unforeseen costs which accounted for a 43pc rise in the admin charge , from £5.3m to £7.6m . Some of this was associated with the development costs of Hello Student . Shares in the company slipped 4.6pc to 108.5p yesterday . Mr. Hadaway said he was relatively unconcerned by a potential drop-off in students from the European Union in the coming years . " It would be wrong to say we're not concerned at all " , he said . " But we've had a record number of 18-year-old school leavers apply and be accepted in universities " . He added that a reduction in overall student numbers had been driven by fewer mature students , and that applications from non-EU countries were continuing too hold up " . [ That is the Telegraph article in its unexpurgated entirety ] .
As an investor in Watkin Jones , I would be interested to learn if anybody knows whether they also try to encourage students/tenants to remain within our portfolio of properties whilst moving to different cities or towns .
All the best and do your own research .