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Warehouse REIT raising more funds

richfool
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Warehouse REIT raising more funds

#207671

Postby richfool » March 14th, 2019, 1:31 pm

LONDON (Alliance News) - Warehouse REIT PLC said on Tuesday it plans to raise GBP100 million through the issue of shares, which will go towards making new acquisitions and strengthening its portfolio.

The real estate investment trust will issue up to 97.1 million shares through a placing, subscription and open offer at 103.0 pence per share. The issue price reflects a 2% premium to Warehouse REIT's closing price on Monday at 101.00 pence.
Shares in Warehouse REIT were up 0.9% at 101.92 pence on Tuesday.

Shareholders can take part in the open offer for up to 66.4 million shares on the basis of two new shares for each five existing one held.


http://www.lse.co.uk/sharecast-news-art ... _portfolio

http://www.morningstar.co.uk/uk/news/AN ... ns-(alliss).aspx


Noting that the SP is currently 101.84p, as an existing shareholder and thus entitled to take up the offer, I can't see the point of taking it up at a price of 103p, or am I missing something? (Apart from the fact that I would be saving the trading fee charged by my broker). Surely I can buy more in the open market at or close to the market price of 101.84p.

richfool
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Re: Warehouse REIT raising more funds

#207875

Postby richfool » March 15th, 2019, 12:56 pm

Since making the above post I have received the paperwork from my asset manager, which mentions that the offer price of 103p is at a discount of 2.4% to NAV. However, I still don't see any advantage in taking the offer up, if I am able to buy in the open market at a lower price.

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Re: Warehouse REIT raising more funds

#207891

Postby PrefInvestor » March 15th, 2019, 1:41 pm

Can only agree with you, unless you wanted only a really small number - in which case saving stamp duty and commission might make taking the offer worthwhile. But otherwise buying on the open market makes sense to me, why pay more. A bit cheeky pitching the offer price at a 2% premium anyway I would say. Who knows they might go lower, they have only recently recovered from the low 90s after all.

Personally I’m staying out of all REITS ATM until the brexit situation is resolved as I think it might have a significant effect on commercial property prices. The last mile warehouse sector (WHRs domain as I understand it) may be more immune to such effects than those exposed to retail and office space I suppose ?. Shame as REITS and housebuilders were major holdings of mine at one point, but no longer. I have some exposure to housebuilders still via some ETF Holdings but no direct holdings.

Good luck with it anyway.

ATB

Pref

midgesgalore
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Re: Warehouse REIT raising more funds

#208985

Postby midgesgalore » March 20th, 2019, 10:49 pm

richfool wrote:Since making the above post I have received the paperwork from my asset manager, which mentions that the offer price of 103p is at a discount of 2.4% to NAV. However, I still don't see any advantage in taking the offer up, if I am able to buy in the open market at a lower price.


Hi richfool
Since you posted this message I also received the paperwork from my broker. It's baffling why WHR would do the placing at 103p which is higher than can be achieved in the open market. I kept reading and rereading the paperwork thinking I was missing something - like another incentive, this was pointless of course.

I did note my broker's FAQ's raise this exact point:
"IMPORTANT INFORMATION WE ARE REQUIRED TO PROVIDE FOR YOU
Please be aware that if you take up your Entitlements your new Shares will be purchased at a price of 103p, regardless of the
prevailing market price of Warehouse REIT plc Shares. At the time of writing, Warehouse REIT plc Shares are trading with an offer
(buying) price of 102.5p per Share. You should bear in mind that if you take up your Entitlement to buy new Shares you could end
up paying more than or less than the prevailing market price. Please ensure that you check the Warehouse REIT plc Share price
before making your decision.
"

If roughly 100 Million shares are purchased in the open market the momentum would most likely cause the share price to rise to at least the offer price.
I think I'll pass though.

midgesgalore

richfool
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Re: Warehouse REIT raising more funds

#209017

Postby richfool » March 21st, 2019, 8:33 am

midgesgalore wrote:
richfool wrote:Since making the above post I have received the paperwork from my asset manager, which mentions that the offer price of 103p is at a discount of 2.4% to NAV. However, I still don't see any advantage in taking the offer up, if I am able to buy in the open market at a lower price.


Hi richfool
Since you posted this message I also received the paperwork from my broker. It's baffling why WHR would do the placing at 103p which is higher than can be achieved in the open market. I kept reading and rereading the paperwork thinking I was missing something - like another incentive, this was pointless of course.

I did note my broker's FAQ's raise this exact point:
"IMPORTANT INFORMATION WE ARE REQUIRED TO PROVIDE FOR YOU
Please be aware that if you take up your Entitlements your new Shares will be purchased at a price of 103p, regardless of the
prevailing market price of Warehouse REIT plc Shares. At the time of writing, Warehouse REIT plc Shares are trading with an offer
(buying) price of 102.5p per Share. You should bear in mind that if you take up your Entitlement to buy new Shares you could end
up paying more than or less than the prevailing market price. Please ensure that you check the Warehouse REIT plc Share price
before making your decision.
"

If roughly 100 Million shares are purchased in the open market the momentum would most likely cause the share price to rise to at least the offer price.
I think I'll pass though.

midgesgalore

Hi Midgesgalore, Thanks for the confirmation of your understanding on this.

I did actually put in a buy order yesterday, to see what it came back with. Whilst it was showing a Guidance price of 103p, the system offered me a buy at 102.42. The only other factor (I could see) was that there was a broker fee on top, whereas the open offer would not incur a fee. I continue to watch, but don't feel any desire to take up the offer.

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Re: Warehouse REIT raising more funds

#209061

Postby midgesgalore » March 21st, 2019, 10:53 am

richfool wrote:... I continue to watch, but don't feel any desire to take up the offer.


Ditto

midgesgalore

richfool
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Re: Warehouse REIT raising more funds

#215225

Postby richfool » April 15th, 2019, 4:37 pm

Further to their recent fund raising of £120M, WHR acquires Northampton and Aberdeen Estates
(Sharecast News) - British real estate investment outfit Warehouse REIT has exchanged contracts to acquire multi-unit estates in Northampton and Aberdeen for a total of £37m.

The consideration for the assets, purchased in two separate transactions, reflected a blended net initial yield of 6.6%.

In Northampton, Warehouse REIT snapped the freehold of two John Lewis distribution units, totalling 336,000 square feet with a headline rent of £1.83m per year.

Up in Aberdeen, the AIM-listed outfit acquired the long leasehold 125,000 square foot Murcar multi-let industrial estate, let to a range of occupiers and generating a total net passing rent of £776,030 per annum.

Current yield 6.00%

http://www.lse.co.uk/sharecast-news-art ... en_estates


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