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I think its actually the other way around - the macro issues, in particular interest rate expectations, caused the SP to tank 20% (same as most reits) which led to the Sainsburys being cancelled.
Presumably the Sainsburys deal not proceeding is the reason for the 20% drop in shareprice along with current national issues.
ASLI is trading low as well, possibly all REITs being hit with inflation concerns, price does not matter short term as long as dividend continues
That's what I thought but thought I'd check as surprised to see shorting on this stock. The new issue at 142p to pay for the Sainsbury deal suddenly looks shaky. This has come out of nowhere for me. I thought this was a relatively safe bet for diversified property income without risky office rental sector exposure. I just don't get it.
Share holding reduced by 0.02%. Short increased by 0.01%.
Can anyone here decode the Blackrock trading activity around 11am yesterday (see most recent RNS)? Looks like some CFDs opened amongst other things. I'm trying to understand if/how this surprise price drop is related. Thanks
SHare price fall might suggest they are struggling to raise the £500m at a small discount to the share price of a couple of days ago, prior to the news of the Sainsburys deal.
Surely there must be a reason, with a divi and a sainsburys deal in the bag, why would it fall...... unless people know something about these sainsburys properties !! Are they all based on Fracking sites ?
Its a bit nuts isnt it ?, this is not what I expected after the announcement of the Sainsbury's deal.
On a 52 week low now ?
£500 million.
£500 portfolio of 18 Sainsbury Stores at 5% yield with potential share issue at 142p.
Makes it a buy at 138p for me.
Is it possibly just general REIT weakness due to rising interest rates?
I was also wondering. Found absolutely nothing so topped up at 141 then watched it keep falling.
Why the drop?
lxi ceo....on sky news atm
https://www.investmentweek.co.uk/news/4049485/lxi-reit-secure-income-reit-pursue-merger
From the article above - The merger of the two property trusts, £1.4bn LXi and SIR, will lead to "significant cost savings," the groups said, which they estimated at £8.6m a year. £7.5m of that would come from the savings of advisory fees, with the remainder coming from "operational cost savings".
Looks good to me shares have taken a 5% hit to 135p though, probably a good time to top up.
Looking good now at 149p
Looked a t a few of them i felt that this at 135p was the better option so I now have some, happy to get in under the 142p too. Quite a few are at full price!
swsquires - agree completely about reit discussion groups. Cash generating companies such as these offer a massive addition to our ISA accounts and provide a more than steady income and as such would make a great talking point. RLE for me has been a really positive addition to my portfolio and as such I actually started a pension fund with this being one of three companies to provide a regular income. One of the others is actually AIRE. Hope you enjoy looking up on RLE. I think you will be pleasantly surprised. Good luck with your research and good luck with your portfolio(s)
Thanks saintly, I've been looking at AEW but will investigate the others too. I had overlooked AIRE as it produced negative returns in 2018,2019 and 2020 but checking again, the NAV actually increased all but one year. I'd be interested to understand why it has always been at such a big discount. It is a shame that there aren't any groups that discuss REITS generally as I feel that would be a real benefit, either on here or elsewhere. I hadn't come across RLE as I tend to look on AIC or Trustnet, so will see what I can find.
swsquires - An impressive selection of reits if I may say so. If you are looking to make changes can I respectfully suggest you have a look at RLE, AIRE and AEW. I am a holder in both RLE & AIRE and just awaiting to buy in (start of new tax year) to AEW. RLE and AIRE both give an impressive 7%+ in dividends which beats inflation hands down. Investors Chronicle - excellent publication!!!- has both AIRE & AEW on its recommendation to buy list so that alone is enough to make people sit up and take notice and commence their own research. I, like yourself, have recently discovered the reit's and really wish I had done so much earlier in my life! With inflation as it is it really makes sense to get more in in income than you lose in inflation. Good luck to all investors and may your gains exceed your losses. Rgds Saintly
Currently I hold LXI, HOME, EBOX, SUPR, LABS and ASLI. I have also put my brother into SREI and THRL. I do want to consolidate somewhat so will likely make changes as discounts/premiums diverge. I am happy with all the ones I hold, although I am a little disappointed in EBOX as the last few assets they've bought were offering relatively low yields (under 4%). I'm more in favour of ASLI as a result. Supermarket REIT and LXI are probably my two favourites and SUPR are very good at providing updates through Proactive and Investor Meet.
I like SREI at the moment as I think there is a good opportunity for the discount to close. I'm also positive on AEW although it is trading at a slight premium. To be honest I think most are pretty similar, hence looking to switch around more.
It is worth following 'The Commerical Property' thread on advfn bb. The discussion is pretty much all on REITS and there are some really knowlegable people sharing their thoughts.
Hi swsquires, I agree with pretty much everything in your post. LXI does seem to be well run and I'm not worried about this drop below the placing either - although timing buying more is tricky in this market. I would like to see many of the reits now get on with deploying the capital they have raised and working the assets as you suggest. I'd be interested if you're willing to share which other reits you hold and which stand out to you as good buys at the moment?
I've held these for over a year and added in the recent raise. Whilst I am disappointed to see the price fall below 142p I am still comfortable with it as an investment. There seems to have been a general squeeze on premiums that many Reits were trading at, in fact Supermarket Reit seems to be one of the only ones trading at a large premium in the UK Commercial Property space. I put this in part down to inflation (there is an upper limit to index linked rents), general markets and rising interest rates. Despite this, the evidence is that this is a well run Reit that has continued to grow the NAV and offer a decent yield. To be fair though, I hold far too many Reits, so should probably consolidate into 2 or 3...
I think one concern that I do have is more general and is being seen across the investment trust and REIT space, more so around property, infrastructure and renewables. I think we have reached a point where these funds are raising money too often. I know that personally I don't see any value in buying in the open market now, unless there is a decent discount to NAV, as you know that the next raise is possibly only a few months away. Whilst most got away lightly with a couple of raises in 2021, we have seen with a number, e.g. LXI, EBOX and ASLI that following the raise they have fallen to below the placing price. I'd like to see a change in tact now - focus on what you have, sell less attractive assets and add value with what you have.