Watkin Jones Share Discussion Threads

[adelwire2] 21/3/2018 08:36

That's the kind of updates we want!

[rivaldo] 21/3/2018 07:52

Indeed - it's this visibility which contributes to WJG's attractiveness - and should make the upcoming H1 trading update on 5th April as upbeat as usual:



"All the developments due for delivery ahead of the 2018/19 academic year have been forward sold. Five of the seven schemes scheduled to be delivered ahead of the 2019/20 academic year have been forward sold, with the remainder now having received planning consent. Five developments, totalling 2,167 beds, scheduled to be delivered ahead of the 2020/21 academic year, have also now received planning consent."

"Mark Watkin Jones, Chief Executive of Watkin Jones plc, said: "The excellent visibility in our student accommodation development business continues with this successful planning consent and further site acquisition. The demand for student accommodation remains high and this, coupled with the growing momentum in our build to rent development business, reinforces our confidence in our business model and the markets in which we operate."

[18bt] 21/3/2018 07:27

Another strong update - business de-risked for another year

[rivaldo] 20/3/2018 13:20

Good news today - adds nicely to the stream of secure future income:



"Approval for student apartment towers
20 Mar 2018

Approval has been granted for the construction of two towers between 16 and 18 storeys high in Coventry, which could accommodate almost 800 students.

The application from Watkin Jones and Son related to land on the north side of Whitefriars Lane and would provide beds for up to 778 students. The proposal also included a new purpose-built three-storey centre for the Coventry Boys and Girls Club....

...."The design of the development is considered to be of high quality and it is not considered that the development will have any significant adverse impact upon neighbouring amenity, highway safety or heritage assets."

Work is expected to be completed ahead of the 2020/21 academic year."

[santangello] 08/3/2018 15:02

Cheers Riv, appreciated.Topped up on the drop yesterday :)

[rivaldo] 08/3/2018 12:18

Looks like good news coming next week:



"Student apartment towers expected to be approved
8 Mar 2018

A bid to build two towers between 16 and 18 storeys high in Coventry, which could accommodate almost 800 students, is expected to be given the green light next week.

The application from Watkin Jones and Son relates to land on the north side of Whitefriars Lane and would provide beds for up to 778 students.

The proposal also includes a new purpose-built three-storey centre for the Coventry Boys and Girls Club.

The two towers would be linked by a second floor canopy over the main entrance.

Coventry City Council's planning committee is set to make a final decision on the plan at a meeting on Thursday 15 March 2018.

A council document published ahead of the meeting said: "The application is considered to be acceptable in terms of the principle of development as student accommodation in this highly sustainable location.

"The design of the development is considered to be of high quality and it is not considered that the development will have any significant adverse impact upon neighbouring amenity, highway safety or heritage assets."

If approved, work is expected to be completed ahead of the 2020/21 academic year."

[shaker44] 08/3/2018 00:35

no. if every divorcing ceo stepped down, not many left!

[shaker44] 08/3/2018 00:35

no. if every divorcing ceo stepped down, not many left!

[2vdm] 07/3/2018 15:42

Hmm. Does that fully explain why he stepped down?

[skinny] 07/3/2018 15:22

Yes - ouch!

Watkin Jones plc (AIM:WJG), a leading UK developer and constructor of multi occupancy property assets, with a focus on the student accommodation and build to rent sectors, announces that Mark Watkin Jones (CEO) has today sold 3,825,000 ordinary shares of one penny each in the Company, representing approximately 1.5% of the issued share capital, in order to facilitate final settlement of divorce proceedings. Following the trade, Mark Watkin Jones holds 3,825,000 ordinary shares, which are subject to a lock-up expiring in 180 days from today, and the Watkin Jones Family* continue to hold, in total, 70,584,407 ordinary shares representing 27.64% of the issued share capital.

14:51:54 195.0000 3,825,000 O 199.4000 201.0000 Sell 20,768 3,856,873

[jockthescot] 07/3/2018 15:15

that's an expensive divorce at £7.5m....

[emmarg] 02/3/2018 17:14

Volume could be due to automatic reinvestment of recently credited dividend payment

[adamb1978] 25/2/2018 11:20

Thanks Jonwig and to your last point, that's exactly what I'm working towards. I'm 20% in cash (or short dated corporate bonds) at the moment and then going to increase that by 10 percentage points every 6 months so that I'm around 50% cash/similar by end of 2019. That obviously means selling some things, and I've sold a few which I think will be worst hit by a downturn, or are moderately levered, or low-ish divi cover. Whilst this will obviously hit my returns, its difficult to see the broader market racing away from here, or for market-level returns being stellar over 5-10 years if you take today as as the starting point, so I dont feel that I'm missing out on a glorious opportunity.

WJG is one which I think I'll hold on to, for the reasons which we both mentioned above

Cheers

Adam

[jonwig] 25/2/2018 09:36

Adam - interesting post. It's not only recession threat (including Brexit), but also political uncertainty which we need to think about.

Regarding students, a project doesn't get as far as development stage until a buyer commits. So the worst scenario would be workload drying up rather than unoccupied properties weighing down the balance sheet. (Unless a committed buyer fails to deliver the cash!)
I'm pretty confident that overseas students will be taken out of immigration statistics, and there's no sign that domestic ones are in for a further squeeze - quite the opposite.

As for the PRS side, I've expressed doubts before on this, but won't go over old ground. I think the PRS will be found under Stock and Work in Progress, £125m. These are held at lower of cost and realisable value but they don't show additions, sales or impairments unfortunately. (Some companies do.) The main financing for this is the revolving credit facility of potentially £40m.
A Labour party committed to rent caps would probably have a savage effect on capital values here, since (I believe) the homes to rent aren't low-grade or in any sense 'affordable'.

A serious market downturn will, as you say, hit good and bad companies alike (and a lot of bad ones will expire). The best strategy is to have a decent amount of spare cash for when the bargains appear.

[adamb1978] 25/2/2018 08:52

Hello all

Setting aside the fact that a recession or simple market correction will take down all the market to a greater or lesser extent, I'd be interested to hear views on how a recession might impact WJG and their earnings.

My thoughts were that demand for student accomodation (from students) shouldnt be cyclical to any great extent and the assets which WJG work on are also very long-term. So the sensitivity to earnings feels to me that it would more likely come from the impact of a recession on investors who buy the accomm which WJG develop (WJG can only sell the properties if those people are buying). But those sort of funds should have long-term/committed capital rather than being funded by hot/fast money I guess. So I'm kind of comfortable that most of WJG earnings should be relatively resilient, apart from in a balance sheet recession (aka financial crisis) where those investors are hit.

Flip side to this is that Mr Market isn't always rationale and investors aren't always that considered, and could just see WJG as a property company and therefore WJG get marked down more than it should.

Would welcome any views - am gradually changing my portfolio over this year and next to be in something of a better place for a downturn, which I believe might well come in the next 24 months.

Thanks

Adam

[santangello] 22/2/2018 09:58

The predictable breakout as the xd period ends (28/02)is underway.

I'd expect 220p + leading up to and crossing that threshold easily, and have opened a large T+20 trade accordingly.

Not my usual style but funds are tied up at present and gift horses here and all that.......

[its the oxman] 22/2/2018 09:25

Short term, gradual recovery back above 220p at least hopefully.

[rivaldo] 19/2/2018 10:04

WJG have submitted plans for a new apartment block in Chester - to be completed by 2020:



"Plans in for Chester apartments
15 Feb 2018

Plans to build a Chester apartment block on the site of a former motor parts factory and car rental office have been submitted.

Watkin Jones is behind the proposals through Trafford Street Chester Ltd.

The site is located on Trafford Street and nearby St Anne Street, and sits on brownfield land. It is currently occupied by two vacant units which were occupied by Partco and Hertz.

The application is to erect a part-four and part-five-storey complex comprising 35 high quality apartments; 16 one-bed and 19 two-bed. It would also include 44 cycle spaces and 39 car parking spaces.

A planning statement submitted by Watkin Jones notes that the scheme would have a "positive impact" on the city, providing the opportunity to "comprehensively redevelop an important, underutilised brownfield site".

"This proposal is immediately deliverable," it added."There is a commitment by the Watkin Jones Group for delivering this development to enable completion by 2020."

[jonwig] 16/2/2018 17:00

@ hybrasil - always a question worth asking!

If it were a housebuilder, then ptb would be excessive, yes. But insofar as it's a facilitator of pre-ordered goods (student accomodation buildings) with little development risk its per is quite reasonable.

Worth remembering that students is a growing property sector, particularly overseas ones with money!

No barriers whatsoever to entry? If you're an institution wanting to invest in new-build student accommodation, would you approach a trusted operator with wide subcontracting contacts, or Corrie's Pat Phelan?

They are also building PRS flats, etc. on their own balance sheet. Yes, that carries risk (and one I'm concerned about) but at present it's a relatively small part of the business.

[hawaly] 16/2/2018 17:00

A 14.4 operating margin might suggest that there's more to it than picking up a trowel and laying bricks.....

GLA

[effortless cool] 16/2/2018 16:58

Its' a great short then - you go for it, hybrasil!

[hybrasil] 16/2/2018 16:38

Is this not massively over valued? No barriers whatsoever to entry thereore in my book its worth asset value only - which is 1/3rd of todays price.

[2vdm] 16/2/2018 11:27

Glaw2. Thanks as well. Just my gut feeling, but I suspect the share price has fallen as far as they will at this point. The mkt has factored in Mark's departure and the business model is robust. As Shake44 indicates, there still remians a wide and deep spread of expertise in cos like this. I may look to top up. Just my view so dyor

[shaker44] 14/2/2018 12:03

I feel sure the city investors would be reassured if Mark stayed as NED. I don't buy that alpha male stuff from my boardroom
Experience. Good businesses have much more collegiate balanced boards these days.
Mark has not only a wealth of experience but also invaluable contacts. Neither should be lost to the business.
And if he does become more detached he will be more unlikely to sell off the family's 30% stake.
I think it is a mistake not to announce him as NED now. Shares won't move forward until they do.