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Home Reit switches to selling property in search for stability
https://www.thetimes.co.uk/article/c2c3d7c6-d3c7-11ed-b1cd-5223fe349502?shareToken=e58d755750691e85b33acfb8ccb39992
Fund manager hoping to ride to rescue of troubled Home REIT receives backing of several major investors.
Nothing really new, but suggests that the bid from Blue Star is a time delay tactic to restrict information. Personally I believe RM will be the best way forward.
Why bother?
Evening Hopin,
I haven’t heard anything yet.
I suspect the rent has been withheld and the tenants went into liquidation due to the residents feeling their properties are not ‘fit for purpose’. I bet the councils have backed their dispute too.
In terms of next steps Reit will likely write the rent off owed by the tenant co’s in liquidation and will have significant costs in putting hundreds of properties right before they can secure rent from either a new provider or maybe deal with the council directly.
Added to that the massive governance issues and potential fraud/misleading investors and the market this is probably a great short position when and if the shares are lifted from suspension.
Nobody has offered an opinion that I’ve seen. I would think writing it off would be a good idea then any offer will feel better.
This is a can of financial and legal worms and huge losses in revenues and asset values loom.
Hi Hopin!
All,
I am a member on other boards but wanted to give you guys the inside track that Lotus Sanctuary CIC has been placed in administration as of last Friday.
Lotus makes up 12.2% of Reit revenues and although the company claims that it has been paid outstanding rent by Lotus I highly doubt that the bills have been settled.
I know this first hand so please take and use this information as you see fit.
Good luck.
Since NCA are looking into the case and if so the possibility of digital trail of money and corrupt transactions at overvalue(some at 300 percent uplift in a few months) and these sham transactions usually involve bribery ...then will the Home reit plc property purchase transactions not become
void under strict money laundry regulations?
If so then its only fair the money would be returned back to Home reit plc and the property transactions reversed.
A good firm of lawers should be investigating this matter on behalf of shareholders.
It’s a little exaggeration I think
We urgently need a new external manager and a much strengthened board
Getting VR (once they’ve covered) involved in some capacity inside the tent isn’t necessarily a bad idea; they’ve been far more right than wrong and having a former short going long and endorsing a new strategy/board/management would be helpful
IMV shareholders asking a shortseller (who financially benefits from company going belly up) to manage the company - have no idea what they're actually signing up for. I hope this is a joke.
Troubled Home REIT faces a boardroom coup and a string of lawsuits as it plunges deeper into crisis
Angry shareholders have turned to short-seller Fraser Perring – whose firm Viceroy Research published a damning report into the landlord for the homeless in November – as a possible saviour.
In a dramatic development that piles pressure on Home REIT bosses, Perring said he has been approached by investors who want him to take charge of the company and turn it around.
I would consider taking it on if they gave me free rein,’ he told the Mail.
‘If investors are reaching out to a short-seller, it truly shows the level of distrust in the current management.’
Moves to install Perring came as the firm endured a frosty annual general meeting with investors in London yesterday.
As well as agitating for change at the top, shareholders are preparing to sue Home REIT as trust in the existing board evaporates in the face of a mounting series of crises.
The company is locked in disputes with several major tenants who have withheld payments in protest against the conditions of some of the properties.
Trading in its shares has been suspended since the start of the year after the firm failed to publish results on time. Meanwhile, a forensic accountant has been brought in to investigate allegations of bribery.
Samthespaniel
Quote by whom?
Social housing of the type Home REIT are involved in sounds a perfect marriage between social and private enterprise. Unfortunately in reality they can't mix. Social housing comes at a cost which requires govt subsidy, and can't be expected to turn a profit, and dividends, for shareholders.
QUOTE: individual savers and others 'genuinely thought that [Home REIT] was a vehicle that was going to deliver substantial social benefit'. He added: 'All of those people are now going to look at other attempts to fund specialist housing support and think twice.' Anyone else with a social conscience will be appalled at this company and the actions of the city slickers that surround it.
Do not direct all your anger at Alvarium.They are American and have a different view of honesty and integrity from us nice folks in the UK.And they do not see it is as immoral to help their mates buy the business out cheaply.I have been an NED on two distressed investment funds having been brought in by shareholders against the wishes of the existing board.You should target your anger at the board.They will be nice people but as feeble as many in the closed end fund world.The Managers select the Board.Do you think they want brilliant people who will challenge them? absolutely not.They want yes - men,with good CVs mostly past their sell by date.And you get extra stars if you get a woman or two.The Directors will have an indemnity policy against errors in the normal line of business.But if they are grossly negligent then you can also sue them personally.From public info to date,they are probably getting very scared……
Thank you richred_uk
I am not a shareholder, but held shares in another REIT, which I sold a few days ago after hearing about Home REIT. I have just now read today’s RNS here. Sounds awful, sounds like the Company is in Deep Sh.., Deep Manure!
!
IIRC ...
Once a company has declared an offer for it, holders over a certain %age (1%?) have to declare all their dealings - unlike the normal TR-1's where they only have to declare when they cross full %age point thresholds. Without checking each one I think these Form 8.3's are holders making declarations of their holdings as starting points.
Happy to be corrected if I'm wrong as I'm NOT an expert.
Yep - unreal conflict of interest
As FT points out HOME should have disclosed that it’s a related party bid
And Alverium need to be terminated instantly
Could someone explain form 8.3 please
It's interesting that only now they're dropping news of rent collections being so dire, only 23% paying must rank this as amongst the lowest ratio of collections for any commercial landlord portfolio. Certainly for a plc must be unprecedented?
It looks like they have a vested interest in kitchen sinking that bombshell, it does appear that Bluestar is effectively a front for Alvarium, the FT have reported on those links now
https://www.ft.com/content/4f8d442c-055b-40a5-a763-7d2f945f5892
Scandalous. This outfit should never have been allowed to float. Regulator must have been asleep at wheel, short report was bang on.
Some asleep at the wheel and fully expecting them to be on pushed out the door.
That said the unsolicited offeror will be eyeing up the portfolio with ultimately those not paying rent out the property and the premises re-let and matters in hand to recoup monies.
WillC
Good research there. This all has a whiff of overvaluations, poor management and now poor stock and revenue. Why has it taken so long to notice? Surely this business model is totally unsuitable for the nature of underyling clients. The short seller might not be popular but has done a good job flushing out these chancers.
Yes - I’m trying to go if my broker can sort out the letter of rep thingy
5 minutes on companies house and linkidin shows numerous connections between Bluestar Group limited, Bluestar Advisors limited and our friends at Alverium
So basically Bluestar is just a front for Alverium (I can’t see any other deals that they’ve done)
Thus Alverium have every incentive, not that they need any help, to manage down values, prevent a recovery as a cheaper acquisition price means a better future potential carry/performance fee