The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
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Thought I read a while ago Grainger were refitting military housing. If the recall of troops from Germany has anything to do with this then good news for them.
Perhaps this week's interim MTVW numbers will help you with your research , but don't wait too long as it seems the secret is getting out! Earnings like this ,aided by low borrowings and overheads, Grainger followers could only dream about.
Grainger have done a lot of work on reducing their borrowings and have secure funding. I think they are heavily London weighted but Grainger management look pretty strong as well. Wouldn't say they were toppy unless bottom falls out of London. They also seem fairly busy selling expertise rather than diving into large capital projects. Daejan are on my watchlist. They appear to have recovered their share price of 5 years ago whereas Grainger still at a quarter of what it was. I was considering diversifying property part of my meager holdings so will keep watching your informative posts on the other sites. Time for some research on Mountview.
These look toppy to me-massive borrowings- relatively low earnings. They pale by comparison to Daejan or Mountview which have low borrowings,better earnings, bigger discount to residential property assets and superb management. Daejan also provide exposure to American residential property recovery and dollar earnings.
FTSE 250-listed residential property owner Grainger has reported a 224 per cent rise in tenanted investment and other sales from its UK portfolios to 26.6m pounds in the four months to January 31st, compared to 8.2m pounds one year earlier. Group sales rose 3.4% to �64.6m compared to �62.4m a year earlier. Vacant UK sales of 201 units generated gross sales of �32.4m at an average margin of 41.1%. This compared to 195 units being sold a year earlier generating �36.4m at a margin of 39.9%. Gross rents declined slightly to �27.3m compared to �30.4m a year earlier. The group said that this was as a result of the disposal of a proportion of its German assets to its joint venture with Heitman. Andrew Cunningham, Chief Executive Officer of Grainger, said: "We have started this financial year with a number of significant transactions. These endorse and expand upon our asset and property management skills and underpin our stated strategic objectives. "Despite the remaining economic challenges, and a slightly subdued market during the first financial quarter, we are seeing increased signs of activity in 2013. Institutional investor interest in the UK residential market continues to grow, supported by positive government measures."
Separately, the company also announced that, as development partner for the Defence Infrastructure Organisation and the HCA, it had submitted a major planning application to Rushmoor Borough Council for the 255 hectare former Aldershot Garrison site, known as Wellesley or the Aldershot Urban Extension. Nick Jopling, Executive Director for Property at Grainger, commented on the Build-to-Rent acquisition: "Our acquisition of this Build-To-Rent block from Bouygues is a significant milestone for the private rented sector, putting into place a new template for the creation of purpose built high quality and professionally managed rental accommodation. "This is a sector that desperately needs to grow in order to meet the demands of the UK population and is supported at the highest levels of Government, and we believe that this style of residential development has huge potential to grow in the coming years."
Residential property owner Grainger has acquired its first build-to-rent scheme in Barking. The transaction, coducted via its agreement to purchase 100 units as part of a regeneration scheme in Barking town centre, is being developed and carried out by Bouygues Development. Grainger will pay a total consideration of £13.7m, with an initial deposit and the balance of the payment due on practical completion in 2015.
Grainger: Jefferies increases target price from 127p to 148p and retains a buy recommendation.
big trade..?.....
Grainger: Peel Hunt shifts target price from 140p to 150p retaining a buy recommendation.
According to analysts at broker Jefferies on Tuesday, this as a "sensible transaction" for Grainger which "allows it to retain (and grow over time) its exposure to the private rented sector without gearing up, while growing its fee income stream." Grainger will provide fund, asset and property management services to GRIP and will be paid management fees in line with those it would have received for G:res. "We are delighted to be establishing this partnership with APG, one of the world's largest and most experienced institutional real estate investors, who are well known for long term, responsible investment," said Chief Executive Andrew Cunningham. "We see APG's commitment as a clear acknowledgement of UK residential property's growing appeal as an institutional asset class, as well as a significant endorsement of Grainger's expertise in the UK residential sector and the strength of our operational platform."
FTSE 250 residential landlord Grainger has created the GRIP unit trust to acquire a residential property portfolio worth 349.4m pounds. The trust has been formed by Grainger and APG Strategic Real Estate Pool (APG), Europe's largest pension fund asset manager with €325bn of assets under management. GRIP, whose aim is to grow by investing in market-let blocks and portfolios focused on Greater London, is to buy a portfolio from G:res, a UK market-rented residential property fund up for liquidation, in which Grainger owns a 26.2% equity stake worth £50.7m. "In June 2011 G:res shareholders voted to progressively liquidate the fund, and today's announced transaction accelerates that process providing certainty to shareholders ahead of schedule," Grainger said. APG is investing £158m in GRIP, while Grainger will co-invest £59m, made up of its proceeds from its G:res stake and £9.1m in new equity.
typo below
British Empire Securities and General Trust said its investments had outstripped its benchmark in the final quarter of 2012. Over the three months the trust's net asset value rose by 7.9%, compared to an increase of 2.8% for its benchmark, the Morningstar Global Growth Index, resulting in an outperformance of 5.1%. French multinational, Vivendi, the largest position in the portfolio, was a significant contributor to the performance over the period. During the period the weighted average discount on the portfolio narrowed from 30.2% at the end of September 2012 to 25.9% at calendar year end. The discount calculation is a measure of how much the share price of each stock in the portfolio is below the firm's estimate of its net asset value. The narrowing was driven by a combination of factors including greater investor confidence and an increase in the level of corporate activity amongst portfolio companies, the trust said.
Residential landlord Grainger rose after creating the GRIP unit trust with APG Strategic Real Estate Pool to acquire a residential property portfolio worth £349.4m.
Grainger continuing its steady rise. 1.40 to 1.50 will be test I suspect as it has struggled beyond these numbers for many years. Fundamentals look better this time so thinking of topping up as believe this can push on to 1.60 this time.
Grainger (GRI) Director name: Mr Simon Davies Amount purchased: 100,000 @ 112.77p Value: £112,770
Grainger (GRI) Director name: Mr Mark Greenwood Amount purchased: 20,000 @ 114.36p Value: £22,872
"Against this background however, through strategic acquisitions and disposals, we have successfully repositioned Grainger to be more focused on geographic locations where economic activity is more robust," it added. At September 30th 2012, 62% of the UK portfolio was located in London and the South East while in Germany, 82% of its properties lie in four of the more affluent areas of the country: Baden-Württemberg, Hesse, Northrhine-Westphalia and Bavaria. Grainger said margins on normal trading sales were maintained at 44% while gross fee income increased by 45% to £10m. The final dividend has been increased to 1.37p from 1.30p in 2011, giving a total dividend of 1.92p, an increase of 4.9%.
FTSE 250 residential property owner-manager Grainger improved annual gross net asset value per share but cautioned it expects subdued market conditions to persist through 2013. The Newcastle upon Tyne headquartered firm said gross NAV increased 3.2% to 223p for the year ended September 30th 2012. The group posted a loss before tax of £1.7m, after derivative movements of £31.2m, compared to a £26.1m profit a year earlier. Operating profit, before valuation movements and non-recurring items, increased to £126.4m from £126.2m before. Grainger said it continued to outperform the market with UK residential and retirement solutions valuations up 3.9% from September 2011. Commenting on the trading environment, Grainger said: "The major housing market indices show that UK national house prices have declined slightly over the last twelve months and liquidity and transaction volumes remain low. The UK economy is likely to remain fragile in the short to medium term, exacerbated by the continuing lack of resolution of the issues around the euro."
Strategy and Future Outlook Historically Grainger's business was in the trading of reversionary residential assets, primarily those subject to regulated tenancies. The scale and quality of this portfolio will continue to provide healthy cash flows and opportunities to produce added value for many years to come. We are constantly seeking ways to maintain and maximise returns from this portfolio. The expertise and infrastructure that Grainger has built up in accumulating and managing this portfolio also has ensured that we have the platform in place that positions the business strongly in terms of long term sustainability and the potential for accretive growth. The Grainger of the future will have a greater proportion of its activities in the rented sector and will supplement these by leveraging its asset and property management capabilities to manage and expand its co-investment vehicles and fee income business. This reflects the changing nature of the housing market. The continued imbalance between supply and demand has led to pressure points. For example, in value terms, areas of strong economic performance such as London, the South East and parts of Germany show resilience and growth, with demand for good quality, well priced rental property continuing to climb. In these areas we see particular opportunities in the build to rent sector including affordable housing. These business activities together with the prevailing economic conditions dictate that we will operate at lower levels of gearing. In the last 18 months we have reduced debt by £376m in a controlled and managed way, whilst increasing the net asset value of the business by £54m. We intend to continue this policy of debt reduction so that by the end of 2013 our overall Group debt will fall below £1bn. At equivalent levels of value our group loan-to-value (LTV) at that point will approach 50%. Once we reach these targeted levels we will consider further our dividend policy. In the meantime we intend to continue our recent policy of increasing dividends by 5% per annum. Alongside this debt reduction programme we plan to remove 5% of costs, on a run rate basis, from across the business by the end of 2013.
Robin Broadhurst, Chairman of Grainger plc, commented: "The value of our UK reversionary assets continues to outperform the market indices and our overall net asset values have again increased due to our active asset management and our long-term strategy to have greater weight in economically stronger areas. We have also made good progress on debt reduction and have set ourselves a target to reduce debt to below £1bn by the end of 2013 which will further demonstrate our evolution into a more lowly geared business. The headroom generated will give us the flexibility to take advantage of attractive opportunities that may arise. We will also continue to strive to improve efficiency in the business and have set ourselves the goal of reducing our cost run rate by at least 5% by the end of 2013. "Grainger remains uniquely placed to take a leading role in, and to benefit from, opportunities currently arising in all parts of the residential property market, many of which have clear Government support. Over a period of time, we will increase our exposure to rental property through our build to rent and affordable housing initiatives. We will also take advantage of our strong operating platform to continue to expand our management activities on behalf of third parties and our strategic alliances with excellent partners, the latest being our joint venture with Heitman in Germany, announced following our year-end."
Operational highlights · Continued outperformance - UK Residential and Retirement Solutions valuations up 3.9% from September 2011 · Margins on normal trading sales maintained at 44% · Gross fee income increased by 45% to £10.0m · German joint venture formed with global asset manager, Heitman which will lead to increased fee income and reduced investment. Grainger will hold a 25% equity stake
NET ASSET VALUE INCREASED OPERATING PERFORMANCE MAINTAINED AND DEBT REDUCED Financial Highlights · Gross net asset value per share up 3.2% to 223p (2011: 216p) · Net debt of £1.19bn, a reduction in the year of £260m (£376m since March 2011) with a plan to reduce net debt to £1bn by end of 2013, a further reduction of £190m · Group loan to value reduced to 55% (2011: 61%) · Operating profit (before valuation movements and non-recurring items) of £126.4m (2011: £126.2m). Recurring profit before tax of £34.6m (2011: £48.3m). Loss before tax of £1.7m, after derivative movements of £31.2m (30 September 2011: profit £26.1m) · Final dividend increased to 1.37p per ordinary share (2011: 1.30p) to give a total dividend for the year of 1.92p per ordinary share (2011: 1.83p), an increase of 4.9%