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the NewRiver REIT (NRR) topic

PrefInvestor
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Re: the NewRiver REIT (NRR) topic

#229010

Postby PrefInvestor » June 12th, 2019, 5:41 pm

Hi All, Well another bad day here for holders, down another ~2.5% to ~189p. Volume about the same as for the last 5 days and no sign of any more RNSs from WIM regarding disposals. But just maybe they are now selling incrementally on the open market ?. I see that RAVP has dropped a further 2p today and I am wondering if that has been caused by WIM selling as well ?.

As for fair value of NRR, well that all depends doesnt it. Typically small REITS like RGL etc trade just under NAV (~115 NAV, ~109 SP) but the big REITS like INTU (~312 NAV ~87 SP) and HMSO (~750 NAV, ~280 SP) are trading at between 1/4 and 1/2 of NAV ATM.

So where would you put NRR in that grouping ?. And INTU used to have a very big dividend too, not any more..........!

Hmmmmm........

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#229032

Postby Silverstar64 » June 12th, 2019, 7:40 pm

PrefInvestor wrote:Hi All, Well another bad day here for holders, down another ~2.5% to ~189p. Volume about the same as for the last 5 days and no sign of any more RNSs from WIM regarding disposals.


I am watching this very closely now due to a much increased holding of NRR in my portfolio.

Today's movement appears to be an increase in the short position of CZ Capital LLC from 1.01% to 1.11%, an increase of 305,564 shares.

I have to evaluate if I take this as a further buying opportunity as I am convinced there is a good strategy and compelling value here.

(I was going to post the link to the short reporting but cannot as a newbie here, Google FCA short tracker or download the Excel from FCA for source of my calculations above)

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Re: the NewRiver REIT (NRR) topic

#229096

Postby PrefInvestor » June 13th, 2019, 7:08 am

Hi Silverstar64, Yes but looking at the volume yesterday then there must have been a lot of other selling too. I had a small punt on these when I entered at 214p and I’m ~12% down now so I’m almost certainly going to take my (still manageable losses) and exit today – to avoid the risk that they might get significantly larger.

I really don’t know exactly how things are going to go from here but XD next week will take another 5.4p off the price and if WIM starts forced selling as a result of their situation, well who knows where the bottom is. I can always buy back in later.

Some may have FOMO, I have fear of staying in.

Capital preservation is a key part of how I manage my investments and I’m afraid I don’t have total confidence in a positive outcome here, in the short term anyway.

Good luck with whatever you decide to do.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#229236

Postby Silverstar64 » June 13th, 2019, 2:35 pm

PrefInvestor wrote:Yes but looking at the volume yesterday then there must have been a lot of other selling too.


We now know from an earlier RNS that Invesco sold 133,831 shares yesterday plus the short sell I mentioned above.

As you can probably tell I am obsessively following RNS, short position reporting and the share price. For reasons I have posted on another investment forum recently I have 13% of my portfolio in NRR as I really like both the company management and strategy.

Hopefully greed will kick back in at some point and fear diminish, always a good model for share price appreciation. When/if that happens then the shorts have to cover and hopefully we are back in 230-240 range.

ATB, Silverstar

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Re: the NewRiver REIT (NRR) topic

#229246

Postby PrefInvestor » June 13th, 2019, 2:53 pm

Silverstar64 wrote:As you can probably tell I am obsessively following RNS, short position reporting and the share price. For reasons I have posted on another investment forum recently I have 13% of my portfolio in NRR as I really like both the company management and strategy.


Well I admire your optimism, a courageous decision - I hope it works out for you. Personally I sold this morning at just under 190 for a few hundred quid loss. You see the possibility of a recovery to 230-240 and its not impossible. But if people start valuing NRR more like the other big REITs then you could be looking at only say 60% of NAV as the share price, ie sort of 160ish. And if the dividend also gets cut, as it might if the share price falls, then thats a further negative.

The woodford situation doesnt seem to have reached its end game yet and I remain concerned that there may be more concerted selling to come. I am not up for a trip to the 160s hence my exit. The shorters arent going to be helping either.

I quite appreciate that my view is very negative and defensive but I have been bitten before with this stock (hey remember it was 300p+ at one time !) and I am not prepared to lose any more money on it.

I really hope that your plans work out for you.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#229493

Postby Laughton » June 14th, 2019, 2:22 pm

RNS issued today:-

NewRiver notes the announcement by Arcadia Group on 12 June 2019, confirming that all seven of its Company Voluntary Arrangements ('CVAs') have been approved by the required majority of the companies' creditors.

For the purposes of clarification, NewRiver confirms that its total rental exposure to Arcadia Group is limited to £363,000, which represents 0.3% of the Company's gross income, and that there will be no reduction to this rental income as a result of the CVAs.

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Re: the NewRiver REIT (NRR) topic

#229826

Postby mattman74 » June 16th, 2019, 7:41 am

Averaged down on Friday at 191p.

Now 5% of my portfolio with a 15% capital loss.

I think this is a case of just collect the divi and wait. It may take several years but eventually the value in the pub estate and shopping centres locations will come through (you try building a retail park in a growing city like Oxford). The management do smart things. Even if things do go wrong the land is worth money for housing.

I was in a similar position with Marston's but they are recovering and I am now in profit after a couple of years.

NRR are deeply unfashionable as well and I like being paid to wait. If(a big if) they can keep the divi at the present value I will have made the money back in 7 years or so.
One of the few advantages we have as private investors is patience and time.

Matt

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Re: the NewRiver REIT (NRR) topic

#229847

Postby formoverfunction » June 16th, 2019, 9:24 am

mattman74 wrote:Averaged down on Friday at 191p.

Now 5% of my portfolio with a 15% capital loss.

I think this is a case of just collect the divi and wait. It may take several years but eventually the value in the pub estate and shopping centres locations will come through (you try building a retail park in a growing city like Oxford). The management do smart things. Even if things do go wrong the land is worth money for housing.

I was in a similar position with Marston's but they are recovering and I am now in profit after a couple of years.

NRR are deeply unfashionable as well and I like being paid to wait. If(a big if) they can keep the divi at the present value I will have made the money back in 7 years or so.
One of the few advantages we have as private investors is patience and time.

Matt


"NRR are deeply unfashionable" in a sector of retailing that has growth prospects. By some forecasts convenience and local shopping is set to grow by 22% over a period between 2017-22 and then grow at rate above general retailing going forward.

I think there's generally value in pub estates, but the combination of income and future development might have great potential.

I rate the management. Overall it's 1% of my portfolio. With luck it will reach 2% of my holdings at some point.

Like you, I'm then expecting to wait and see how they get on and enjoy the income, well recycle it, over the next few years.

I agree with your view on timescales, it's the decisive advantage we have.

As much as a play on value, NRR is a play on the changing appetites of millennials.

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Re: the NewRiver REIT (NRR) topic

#230203

Postby flyer61 » June 17th, 2019, 5:11 pm

Higher turnover than usual today with a positive price reaction.

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Re: the NewRiver REIT (NRR) topic

#230295

Postby PrefInvestor » June 17th, 2019, 10:14 pm

flyer61 wrote:Higher turnover than usual today with a positive price reaction.


Yes a nice move up for all holders. Doubtless many income seekers jumping at the thought of an 11+% yield with a first instalment due this Thursday. I can completely understand it, but it hasn’t changed my personal views on the risks associated with NRR and what they might possibly mean for the NRR share price.

At the end of the day this is a company with 56 employees, they have ~£800M in assets (~£900M a year ago) and a lot of debt (LTV 37%, was 28% a year ago) and they declared a £37M loss in May 2019 (made a profit of £46M the year before). All that said they are clearly good property managers - at a very challenging time for managing commercial property, especially retail assets.

But I am quite prepared to be proven wrong.

Good luck to all holders.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#230584

Postby mattman74 » June 18th, 2019, 8:49 pm

Let's have a look at the most recent pub deal....

They have bought 76 pubs for £12 million from heineken - property "all over the country".

That is £158K per pub. Lets assume the businesses are worthless.

Pubs are big properties - often with car parks and (beer) gardens

They have just bought 76 huge houses all over the country for less than £160 K a pop. Yes they might need planning permission for change of use etc etc but they are not going to lose money on that deal. It is smart business transaction which the Lockharts are good at.

Some will be converted to convenience stores, some run as pubs and some sold to property developers.

Have a look round your local neighbourhood. What is happening to the pubs that have shut down?

Matt

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Re: the NewRiver REIT (NRR) topic

#230663

Postby BusyBumbleBee » June 19th, 2019, 9:17 am

mattman74 wrote:Let's have a look at the most recent pub deal ... £158K per pub... They have just bought 76 huge houses all over the country for less than £160K a pop. Yes they might need planning permission for change of use etc etc but they are not going to lose money on that deal. It is smart business transaction which the Lockharts are good at.

Well said, Matt : This is one of the major reasons why I like NRR. Not only do they have a portfolio of good income producing properties but they also manage to do a goodly number of NAV (and income) enhancing deals. The market will recognise this eventually and value will out. In the meanwhile the dividend - which looks to be sustainable - gives me great pleasure and is above my annual return target of 9% in capital growth and dividend income.

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Re: the NewRiver REIT (NRR) topic

#230676

Postby rippleog » June 19th, 2019, 10:03 am

mattman74 wrote:Averaged down on Friday at 191p.

Now 5% of my portfolio with a 15% capital loss.

I think this is a case of just collect the divi and wait. It may take several years but eventually the value in the pub estate and shopping centres locations will come through (you try building a retail park in a growing city like Oxford). The management do smart things. Even if things do go wrong the land is worth money for housing.

I was in a similar position with Marston's but they are recovering and I am now in profit after a couple of years.

NRR are deeply unfashionable as well and I like being paid to wait. If(a big if) they can keep the divi at the present value I will have made the money back in 7 years or so.
One of the few advantages we have as private investors is patience and time.

Matt

As you say patience...
clearly a value REIT but we need to see the back of Mr Woodford before you see any capital appreciation so meanwhile you will have to content yourself with that quarterly dividend.
I have a very small position at present..... (0.2% of my SIPP)!

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Re: the NewRiver REIT (NRR) topic

#230938

Postby PrefInvestor » June 20th, 2019, 10:40 am

Hi All, Well another Woodford sale reported via an RNS on the LSE today, looks like a 2% disposal this time dated 18th June. Leaves them with ~12.8% now. Share price holding up pretty well after going XD for 5.4p today though.

Just to be clear I have nothing against the company, I actually agree that they seems to be very good property managers. Slightly worried about the small size of the company versus the very large size of their property assets and debt - but thats only a niggle really. However if woodford selling is going to take the company much lower (still too early to call I personally think) then Ill wait for that to buy in, the "being paid to wait" position doesn't sit well with me. Guess I'm too impatient to sit around looking at big red numbers in my portfolio hoping for a recovery !.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#231001

Postby mattman74 » June 20th, 2019, 3:30 pm

PrefInvestor wrote:
Just to be clear I have nothing against the company, I actually agree that they seems to be very good property managers. Slightly worried about the small size of the company versus the very large size of their property assets and debt - but thats only a niggle really. However if woodford selling is going to take the company much lower (still too early to call I personally think) then Ill wait for that to buy in, the "being paid to wait" position doesn't sit well with me. Guess I'm too impatient to sit around looking at big red numbers in my portfolio hoping for a recovery !.

ATB

Pref


Thanks for the heads up about Woodford. That position will unwind over the coming weeks. There seems to be some sort of floor at 190p.

The way I deal with the red numbers in my portfolio is to just worry about the income.
I averaged down with Marstons and waited and that is slowly coming good. The divi has been stable.
I did the same with Pennon a few years ago back because I was convinced that the Viridor ERFs were a super idea and that slowly recovered. With pennon the divi has been increasing at 4% plus RPI. In both cases I have been collecting the divi throughout.

Make no mistake this investment is a calculated risk but I feel I have done my due diligence and I think understand what is going on. (Unlike Carillion or many other of my investing misfortunes)

I am hoping that it ends up up like my enthusiasm for renewables when no one was interested. Time will tell.

Matt

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Re: the NewRiver REIT (NRR) topic

#231933

Postby PrefInvestor » June 25th, 2019, 12:26 pm

Hi All,

Well another Holdings RNS published today, this time detailing a 0.5% sale by St James's Place on 24/6 by the look of it.

Short interest reduced a bit today to 7.6%, was 8.4% yesterday I think.

Share price has dipped below 180 today. I shall start to get interested again at about 165.......but of course it might never get there.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#232648

Postby PrefInvestor » June 28th, 2019, 11:32 pm

Hi All, Another Holdings RNS published today. Looks like Woodford disposed of another ~1% on 27/6. Woodford holding now 11.84% according to the RNS. Price held up well today I thought.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#233200

Postby PrefInvestor » July 1st, 2019, 4:23 pm

Hi All, No new NRR related announcements in respect of Woodford as far as I know, but there has been announcement that he has sold all his RAven Property Group ordinarily shares ticker RAV for £26 million (note that Invesco have also disposed £12 million worth at the same time). Price was 36p a share, in total that was 17.7% of the market capital of RAV according to the RNS I read. Seems that it’s the company itself that is buying the shares and approval from shareholders is required according to the RNS. Hasn’t done the RAV share price any harm, up 4.x% today.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#233811

Postby PrefInvestor » July 3rd, 2019, 10:45 pm

Hi All, Another Holdings RNS published today this one a sale by St James’s Place on 2/7, not immediately clear to me exactly how many were sold as all it says is that their holding was reduced from 3.9% to less than 3%.Doesn’t appear to have done anything much to the share price which is still in the range 177-181.

ATB

Pref

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Re: the NewRiver REIT (NRR) topic

#234037

Postby monabri » July 4th, 2019, 9:13 pm

PrefInvestor wrote:Hi All, Another Holdings RNS published today this one a sale by St James’s Place on 2/7, not immediately clear to me exactly how many were sold as all it says is that their holding was reduced from 3.9% to less than 3%.Doesn’t appear to have done anything much to the share price which is still in the range 177-181.

ATB

Pref


I think it works like this .

The total number of shares in issue by NRR is 305.7 million. This is the qty on Morningstar and a similar number on another source.

So they held 3.9% of 305.7 m shares which has been reduced to less than 3%.

In the RNS they quote the follow numbers.

9035894 = residual holding
305712984 = shares in issue ( by NRR).

9035984 / 305712984 x 100% translates to 2.9557%


So, they've sold 0.9443% or 2.8868 million shares.


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