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they may be under NDA with the lender so cannot disclose.
not sure sure 1.3% is accurate for default - I suspect much higher than that but all priced in. I am a holder but my only concern with Civitas is that I don't believe they disclose things appropriately and have a small concern that we will have some surprises but again all priced in so should be fine
Canetoad
PS who is your stockbroker?
Thanks
Canetoad
I was asking this elsewhere "Anyone able to tell me if you pay income tax (PID) IF you have your REIT in an ISA??"
So I can take it the answer no. Thanks
The new facility is 5.69%
It's on the high side, but not ridiculous.
I've held these in both an ISA and SIPP and didn't get any tax taken out.
PS and very reasonable spread.
As an aside is there tax on dividends in an ISA??
There is a distinct lack of clarity over the actual interest rates.
The company has a lot of gearing so actual rates are important.
Also have never covered there dividends. Why pay out what you can't afford?
On the upside very nice discount for those who have bought recently.
One only default on rent amounting to 1.3%. Not many social housing reits can say that.
I reckon there is a lot of read across from home reit?
Here we go again, Lucy version 2.0
Most likely not even invested here just another de-ramper who've read something somewhere from an obscure analyst
... so holding flat is actually more than a 2% rise. :-)
So, why the inconsistency in what they told Quoted Data and what they reported today? As you put below, Quoted Data reported it was an institutional investor and in today's RNS they say it is with a leading major European bank lender. If it was actually a bank lender, they wouldn't have had a problem with their name out there... Just a bit worried that this could be with an aggressive lender with very restrictive covenants and all the rest.
To fully draw down that piece and then doing a deal with a hedge fund or alternative credit type investor (if that is what it really is) is dancing with the devil.
Would be great to have some further clarity from the company on who the lender is and what covenants are like... I think it is quite material, dont you guys?
Anyway, at least the refi is out of the way!
Indeed, and why not make mention of the interest rate to be paid, the latter being very important!
Yep, spot on canetoad.
And I have got a massive load of dividends coming my way. Win win all round.
(obvious correction: £70.875m)
From a few days ago:
"On 1 December 2022, it agreed a $70.875m senior secured guaranteed note with an institutional investor. The facility comes with a 5.69% fixed coupon and is due in February 2028. The transaction is expected to close in mid-February 2023, subject to certain conditions. The company intends to utilise the facility to redeem the existing Lloyds Bank loan, as well as providing additional liquidity."
I could be mistaken, but that looks to be exactly what they have said/done today.
@Baoxiou: have a look at page 20 of the Quoted Data paper from a few days ago. Unless I am mistaken, the new facility is 5.69%. From what I gather, this facility is not from a bank.
Debt is not cashflow.
I understand that profits must flow out but as a REIT you are absolutely not required to draw down debt to pay out a dividend.
I just really wonder why they are hiding the name of the lender... put this together with the change in language about payments received, its all very murky...
Look at Home Reit this morning.... they claim to have received a NON-BINDING offer from Blue Start Limited who are a company with £170k of assets.
Civitas should be transparent and provide us all with more detail at the moment, not less... how do we go from knowing who the Lender is and the terms to not having a clue. Why don't they also share the cost of interest on this facility? Vert simple questions...
@Baoxiou: "This means they are drawing down debt to fund a dividend - doesn't sound healthy."
NO... All REITs have to return 90% of the cashflow so there's limited chance to pay down debt; instead, they roll the debt over and/or eventually issue more shares. That's not a bad thing when inflation is reducing the debt by 10% a year. Nothin unusual. What it means is that the risk of not being able to roll the dbt is gone. This is as expected. If you were expectign the debt to be paid down, don't invest in a REIT!
Anyone have an idea? Seems odd and I don't get why they fully drew on the financing already. They replaced a £60m facility with a £70m facility and we are already fully drawn on it?!!
This means they are drawing down debt to fund a dividend - doesn't sound healthy.
How is it positive news? LTV is up and the financing is fully drawn...
Also, why don't they tell us who the lender is - more cloak and daggger. Don't see a reason why they cannot say who it is.
Very positive news today.
Gonna keep buying all the while it stays near 60p seems like a bargain for something this stable.
Time to buy?
Civitas Social Housing (CSH) has suffered a sustained fall in its share price which sees it now trade on a discount of 44.4%. This seems wholly unjustified given the strong market fundamentals in the social housing sector and the group's proven, secure government-backed income.
CSH's inflation-linked leases (which benefit from annual rental uplifts in line with inflation as measured by the consumer price index (CPI) or CPI+1%) more than compensated for a higher discount rate used to value its portfolio on a discounted cash flow method (following market volatility caused by higher interest rates) and resulted in CSH reporting a healthy uplift in net asset value (NAV) in September 2022 - one of the only real estate investment trusts (REITs) to do so in the period. Its NAV fell by 3.4% in the quarter to December 2022, which compares favourably with the REIT sector.
The inflation protection, improving strength of its tenants, and strong market fundamentals make the group's discount to NAV and high dividend yield extremely attractive.
Good write up about CSH and good to see the company bringing it to everyone's attention via RNS. Way undervalued here!
The facts are nothing but good here lately and in view of that I'm adding. Investment grade rating reaffirmed + the recent 2 RNS reduce a lot of risk here.
Good to read that Fitch have maintained their A rating for CSH.