NewRiver REIT Live Discussion

PrefInvestor1 23 May 2019

FY Results Hi @devonplay, Well I confess I don’t see the value in IUKD right now. Looking at the chart it’s been falling even when the market was rising, largely I think because there are a lot of very poor performing but high yield stocks. I don’t see the likes of CNA, SSE, NG, VOD, RMG etc. making a big share price come back anytime soon myself. Not the way things are going anyway. ATB Pref

devonplay 23 May 2019

FY Results Congratulations on the NNR purchase. I haven’t sold any IUKD. I’m actually planning to buy more. I haven’t looked at my portfolio today, just the headline figure. It’s been a busy one for me. Moments like this IUKD and AV get pushed up my list. DL

devonplay 23 May 2019

FY Results TX2: a smallish part of diversified range of property shares. That’s something I agree with the need to have a diversified portfolio. I hold a range of smaller REITs as well as TR Property. Which for me is a buy in a difficult markets. I’ve even recently been adding LBOW as debt play on the sector, it has an LTV I’m comfortable with as a lender. I don’t disagree with your assumptions about downward pressure on smaller estates,but one of the things that really attract me about the stock it the cash flow from the “pubs” and the potential to create community hubs by combining the “every day purchases” stores and pub carparks. I happen to belive they have a good management team with the creativity to add value to less attractive sites and units and create further value form the pub estate. Combined with they yield, I’m willing to take a "punt’ on that.

TX2 23 May 2019

FY Results NRR is not actually making a loss on a net rental basis;it made a profit of around £50m after loan interest etc on its properties.Profit/loss on property companies is worked out differently from normal businesses in that any increases or decreases in the property values are added or substracted from the the net rental figures to arrive at the final figures. Obviously as a result when property values are increasing;property companies appear to be making huge profits,presently when property values are declining many property companes will report losses even though their rental income has remained at the same level. The worry of course is that property values will contnue to decline particularly in the retail sector and as a consequence gearing will increase as borrowing will form a higher proportion of value and LTV ratios could become too high from a lenders perspective even though the company can pay the interest payments as previously. I think we need to look at the type of property & its potential for maintaining its value before chasing high income and avoid companies with too high existing LTV ratios. NRR is perhaps OK as a high income “punt” if it is just a smallish part of diversified range of property shares.But we do have over supply of retail properties and this will affect even better quality but lowish rental retail parks like NRRs with downward pressure on rents. I hold quite a few REITs & general property companes;but most are presently priced about right.Amongst REITS McKay Securities,which I hold,seems good value on account of its high quality portfolio & future development potential.

PrefInvestor1 23 May 2019

FY Results Hi @devonplay, Well just fallen out of love with IUKD thats all really. I think its busily converting capital into income !!!. Here is that chart I mentioned:- image.png964x548 43.1 KB Pretty dire. Just bought some NRR at 213.98 using my IUKD funds, much better than my 219 limit order !. ATB Pref

devonplay 23 May 2019

FY Results From this morning presentation: nrr.co.uk 19-05-23-newriver-fy19-presentation-final-print.pdf 12.45 MB DL

devonplay 23 May 2019

FY Results Hi Prefs, you down move around alot lol Yes they could have been far worse, overall acceptable I think. It’s not going to be an easy ride, but logterm the sector and the management team appeal. Maybe I have a longer time frame or greater risk tolerance, but for the moment I’m holding and seeing how it plays out. DL

PrefInvestor1 23 May 2019

FY Results Hi Again, Just scanned today’s full year results and it’s clear that they are being impacted by the grossly negative sentiment wrt retail property. Now loss making, NAV down, dividend maintained but cover reduced, LTV up. Could have been far worse I guess ?. But have pulled my limit order… ATB Pref

PrefInvestor1 22 May 2019

FY Results Hi @devonplay and @marktime1231, Funny I was just looking at PCA this morning as I have been for a REIT like stock to invest in. But NRR having plummeted today I will likely buy that tomorrow now, got a limit order set at 219… Money has come out of IUKD which I just baled out of on Monday. Really not happy with the set of stocks it’s invested in. But then the strategy of investing in the top 50 high yielders is just bound to pick all of the duffers out there - CNA, VOD, RMG, SLA, SSE, MKS, BT, ITV, all the housebuilders. Just a collection of disastrous choices right now it seems to me, do I’ve pulled the plug and am going to invest elsewhere. Was already down 5% in total return terms and I couldn’t see this situation improving. I’d post a comparison chart against the FTSE 100 fir the last 12 months if I could (not so easy from the iPad) but it’s not pretty. ATB Pref

devonplay 02 May 2019

FY Results I believe so, I’ve a got a foot in the door holding. I’m happy to do that with stocks like PCA. As they say: I’m “getting paid to wait” and if York proceeds smoothly, or we get a sudden general move down day, I’ll add. Good luck with it. DL

marktime1231 02 May 2019

FY Results Thank you DL, at a glance PCA does fit my criteria sub 280p and seems to be under-appreciated while quietly developing attractive projects and delivering attractive income. One to watch.

devonplay 02 May 2019

FY Results As it happens PCA has updated on trading this morning. Yield is a healthy 6.7% and LTV is 33%, nice and conservative. [link] Palace Capital (LSE: PCA), the Main Market listed real estate investment company that has a diversified portfolio of UK commercial real estate in carefully selected locations outside of London, provides the following trading and portfolio update ahead of its results for the year ended 31 March 2019, which will be announced on Tuesday 4 June 2019. Portfolio highlights · Disposal of 50 residential units (part of the Warren Portfolio) for £18.2 million to Barnet Council which completed yesterday (1 May 2019). · Acquisition of 1 Derby Square, Liverpool in December for £14.0 million producing £1.0 million in annual income with considerable reversionary potential. · 37 leases and rent reviews completed in the year-ended 31 March 2019 at an average 14% ahead of Estimated Rental Value (“ERV”) generating £3.4 million rent per annum, reflecting an uplift on previous passing rents of £0.8 million. · Building contract signed and £26.5 million facility secured with Barclays Bank for the Hudson Quarter development in York, on very competitive terms. · Resolution to grant planning consent from Elmbridge Borough Council for the development of three retail units and 28 apartments at 41- 45 High Street, Weybridge, Surrey. Financial highlights · Strong cash position along with unutilised debt facilities to fund the Company’s refurbishment and development projects as well as capacity for future acquisitions. · Group remains conservatively geared at 33% net Loan to Value (LTV). · First full year on the Main Market of the London Stock Exchange. Palace Capital Home - Palace Capital Palace Capital is a property investment company with a premium listing on the Main Market of the London Stock Exchange (Stock Code: PCA). The Company owns a diversified portfolio across the UK and has a reputation for being entrepreneurial and... I’m wathcing to see how that development work in the North (York) goes. I’ll be Adding more in the low 280’s. If and when. DL

marktime1231 01 May 2019

FY Results Fair enough, I might develop a holding in both RDI and NRR, while they are trading like junk stocks on a 30% discount. The possibility of more acquisitive attention in the background. Not familiar with your other suggestions, my only other watching is the sheds play ASLI which has failed to deliver the “attractive” income it promised. The big divi on IUKD comes in June I think, I have been biding my time for a drift in the price before topping up. Otherwise I will gamble on another small cap with developing/ recovering prospects like BILN or DX. Or GNK, RIO, BP, PFC … which may be inching back into play. Or RMG in case everyone is wrong. Actually there are enough cheap options at the moment you can wait for your preferred stock to hit bargain basement or just dip into whichever of your basket of candidates looks the most oversold.

devonplay 01 May 2019

FY Results I’ve been accumulating NRR for some time, so I’d say spread the love. But don’t do the splits, it remains a contrarian long term punt. I had similar plan for LBOW, but that’s moved up slightly since I started buying (and I was commited to buying under 100p). I also like RLE. I hold PCA, but wouldn’t rush into them, there’s going to be plenty of time as they work through development projects. I’m trying to decided between IUKD, LBOW and BNC for my April div. income. or If I’m feeling radical IUSA or NAIT. We keep hearing how this 10 year bull run is coming to an end, but there’s been occasions when bull runs in the US have lasted for 20 years…could we afford to miss out on another 10? I’d be happy to pound-cost-average into either with a long enough view without worrying about a correction. Slow investing, you still have plenty to think about. DL

marktime1231 01 May 2019

FY Results Shucks, have I picked the wrong one? Backing RDI which has plunged back to 120p after it turned away Cromwell’s conditional interest at 180-185p on the grounds it undervalues. NAV including the effect of a problem with Aviva’s funding conditions on four UK shopping centres maybe 192p ish. Hmmm. Meanwhile NRR has kicked back up to 240p which feels like a fair price to me while sustaining an 8%+ yield, whereas RDI trimmed the H1 divi hoping to restore it in H2 if the Aviva issue is resolved. So should I redouble RDI or spread the love to NRR?