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Finally getting somewhere. £22 million under offerand another £20 million under negotiations.
Total £42m if LTV is 55% should leave £20m free after £22m is repaid loans.
With the other cash £35m+20m that should cover the £50m bond.
More sales to follow should turn round this sinking ship, shame inglis didn't do it 18 months ago, would have got much better prices.
This isn't rocket science, Inglis only needs to sell £80 million of offices, call it at 11% yield. His made the situation bad by in action.
And the situation would be stabilised.
Don't know why his hanging on, he needs to call his mates I other REITS/property sector who have cash to buy a good 11% yield.
The dividend should be paid in script not cash.
This is bieng made into a debacle, the market is valuing the company at £60million plus debt now far from the so called NAV.
Wake up Inglis get a move on.
This will continue downward until the big sales are announced.
A couple of years ago the portfolio was worth over £900 million and now £700, and dropping around £20 million every quarter.
If inglis would have sold earlier could have sold £200 million of assets and still have £700 million today. The debt would have gone down by £200 million.
Still one last chance left to dispose before the it breaks covenants (in 4 months time) and goes bust i, time is running out, very badly run.
If he would have listened to me months ago we wouldn't be in this mess. Every inheritance REIT has sold offices at NAV so it's not a case case they won't sell. Inglis is choosing not to sell.
He needs to pull his finger out and get rid of £100 million of assets. Sure the dividend might need rebating but if the NAV is really that high then its the best way ford to get things under control, rather than rights issues, etc.
The longer this goes on the more trouble it will cause. Get a move on.
Sales under 20p today.
Bcpt REIT sold some offices taking a 6% hit since thier December valuation.
Definitely going to breach the LTV. Why isn't inglis selling whilst every other REIT can manage to sell office assets?
We know that the NAV will fall another big % probably down from £700 to £600 by the mid year so another £100 million which he could have sold off.
Why does his want the share price to go to 10p?
Not rocket science, just need to sell some property quick and all will be stabilised.
Inglish has secured main debt at a low 3.5% so doesn't want to sell. The problem is debt not cash flow, he needs some proceeds to cover the £50 million and also to narrow the NAV if it is really £700 of offices if he sells what difference will it make on the fund if it goes to a £600 million fund.
The guy is running it like a private old school property company but the market works different and is concerned about risks.
The sooner he listens the quicker this can be turned around.
If Steve Inglis doesn't sell properties within the next couple of months the covenants will be breached. They have only sold 3.5% of the assets in the whole year. They need to wake up and smell the coffee. The whole thing has 10 months left.
Valuation down by 11%
Rental down by 6% - £4 Million
Rent Collection down by 1.5%
Occupancy down by 3.4%
LTV up by 6% heading to breaches within months
Nothing positive about the update and all other REITS are reporting similar for offices, no turnaround in sight yet.
As can be seen below from Picton/commentators in the game the Office Market is struggling. If they cant sell these properties they need to change of use them to residential or other quickly.
"With the 30% weighting to offices continuing to blight the portfolio as working from home shows no signs of coming to an end. Office prices were down 2.4%.
Morris also secured ‘valuable residential permitted development rights’ that will allow the trust’s offices in Angel, London, to be turned into flats, which will ‘maximise future disposal proceeds’.
Gilligan noted that the UK property sector is still considering with a number of macro issues, with interest rates still high, credit conditions tightening, and ‘uncertainty over where flexible working will settle in terms of office and home mix and toughening environmental standards’."
RGL haven't sold much, they don't seem able to sell. With other REITS reporting office values dropping just under 3% a quarter that NAV will be heading towards covenant levels soon.
Don't know what the delay is in selling, we have hardly had many sales announcedin 6 months, the office market is weak so no point waiting till it recovers as we're losing 3% value every 3 months.
Heading towards £8 in a big downward pattern.
The CFO Leaving should have sent some signals, Rustys comms are poor, with complex derivatives and losses, the Methane issue, alot of debt with rates high, and now Bidens new tax will be another overhead. Not much positive except a shaky dividend.
Until Interest start to drop Rusty needs to sell some more non productive assets and keep on producing the gas, dishing out the dividend, and keep up the buy backs.
Should stabilise then, until then there is more short term liabilities than assets.
Not looking to good with occupancy down 2% per quarter, 8% per year its going to increase costs significantly.
Rental has declined from £72million and keeps falling every quarter.
The LTV has crept up, note they are still working on June valuations and the market has fallen since.
The cash situation has gone -£20million in 3 months without any explanation, where has the money gone, quite worrying if that much cash is being hemorrhaged.
Minimal sales achieved, need to press on with sales.
What's clear is Inglis is quite professional and convincing salesman on his performance, but if study the figures, they actually show declines.
Agricole - if you take a lower rate of decline eg 4% a quarter then over 4 quarters from June 2023 thats 16% and breach of ltv.
Gross value of property as at June 2023 is £752 million.
Decline of 16% makes the properties value at £631 million. Loans are £393 million. So that would give a ltv of 62%.
As you say we're expecting sales but there's no signs of any sales yet.
The main thing to question is why would you wait to sell your offices knowing they are declining 4 - 6% every quarter. Your going to lose £120 to £180 million in value sitting on them over a year.
There seems to be no momentum.
Agricore - a 5.9% drop per Quarter is 23.6% annual drop for bcpt offices, thats fairly massive. Every REIT is reporting that the office market is falling in value.
if this happens to Regional REIT the covenant will breach by March next year.
Currently the LTV is 53% - last results were upto mid year so 3 quarters of -5.9% drops = -17.5% drop which takes it above 60% ltv.
Sales sales sales quick needed.
From the BCPT REIT Today, looks like thier offices fell 5.9% in the last quarter making it 23.5% fall in a year, the covenants look like they will breach.
What is happening to sales, why are we waiting to a fire sell at -23% year?
Inglis think with your head not your heart.
The Company's office holdings were a drag on performance, with a capital fall of 5.9 per cent over the quarter. The portfolio, which is focussed on high-quality assets in resilient locations, continues to see strong levels of occupational activity. However, sentiment towards the wider sector remains weak and the perception of illiquidity has resulted in the equivalent yield on the assets softening by 48 basis points over the quarter. Despite such weak sentiment, offices remain the most highly traded sector, with the bifurcation between prime and secondary assets remaining a defining characteristic for both occupiers and investors. We continue to execute a targeted and managed process to reduce the Company's office exposure as part of a strategic repositioning of the portfolio.
The 5% drop is for 6 month period and the properties are general non offices. Assuming that's 10% per year for non office, how much is the decline for offices, 15% - 20%.
And if so will the covenant break as the ltv was already 52% up till June 202.
Would you wait 1 year and sell your offices for 15% - 20% less or offer a 5% to 10% discount now? And get more money for the sales!
The asset value they publish is probably well over rated.
The proof is Inglis can't sell the property near NAV or his choosing not to sell, his been talking of sales for months but nothing happening. Other REITS have sold offices in the last quarter so its possible to sell.
Realistically the assets worth around £650million giving a gross yield of 10.5% in line with the office sector, not the £790 million published.
Sell a property and validate the NAV to the market. The 50 million bond is the least of worries at the moment.
The difference we see here with other REITS is that they are all saying that tge office sector is falling in value whatever % it maybe and they are all selling and repositioning.
Inglis has been talking of sales for a while but nothing has been sold or announced and that's what's deflating the share price.
If you can sell assets 3 times the current share price why wouldn't you and reduce the debt, the share price would near double.
Can anyone explain why his not selling or if his doing so his going much slower than other REITS.
From Town Centre Securities report today below. Anyone heard of any sales yet to reduce the LTV here?
Regional offices
As with retail, the office market is also facing significant macroeconomic challenges, and this is coupled with uncertainty around tenant requirements in terms of both size and location. With ESG requirements evolving, the environmental credentials of a building developed only five years ago are very different from those of a new build office. The flight to prime is being felt especially in the office market and the experience in regional offices is no different to that in central London.
Our office portfolio, located mainly in Leeds and Manchester, suffered a 17% reduction in value over the year, all of which related to market sentiment and the underlying investment yields.
Office
The office market is seeing values reducing for secondary regional office buildings, where there is a flight to ESG-compliant buildings. Differing company policies in relation to working from home are also having an impact on office occupancy and related trade for surrounding businesses as well as car park utilisation. Employees of some tenants are working 5 days per week in the office, others 2 days per month, and employers are seeking to find a balance between the needs of their organisations and what suits their workforce. TCS's biggest tenant, Leeds City Council, is an example of an organisation whose office occupancy levels are very different to those before the pandemic.
Krustysmegma the dividend isn't covered from what I can see, in one place I saw generation of 1p per qtr = 4p (50%) and in another place it was saying 90% cover.
Not sure which is correct, if someone can double check and confirm. If its 4p to 5p then the share price could head to mid to high 50s.