Regional REIT.

[midgesgalore]

As the 14th July deadline approaches, anyone further views on the Open Offer?

...

I also hold SLI and WHR in that sector.

Snap!

midgesgalore

[BrummieDave]

I think there's been a bit of misleading quoting above midges

It's not a problem but for clarity's sake, it was richfool who said he also holds SLI and WHR, not me. By coincidence, I do also hold SLI, but not WHR.

As RGL is only 2% of my IT Portfolio, and property overall including SLI only 5%, as I have the required funds sitting as cash from recent dividends within my ISA, I will probably tick the box and take up the new offer at what is looking like being the current SP with a small discount to NAV.

[midgesgalore]

So I see BrummieDave.
I'll try to sharpen up my act a bit in future.

I also hold Tritax Big Box, all at just under 2% of the income portfolio. I'll take the 1/8th more of Regional REIT and that's it for property.

midgesgalore

[richfool]

As the 14th July deadline approaches, anyone further views on the Open Offer?

With the SP sitting at 107p and the offer being 106.5p there isn't any obvious immediate gain.

If it's of any help, RGL is up a tad this morning, @ 108.40p to buy (107.80p to sell), so above the offer price.

[midgesgalore]

Guys,
I will take up the offer as I stated earlier but since the price to buy is currently 107p (106.8p to sell) I will hold off until Friday and see if the payment of the up-coming, 1.9p, dividend alters the share price below the offer price. I expect not.

On a small note aside, my broker gives me until noon on Tuesday 16th of July to commit to taking up the rights issue entitlement. I see it reported as July 12th above which is dividend payment day. I wonder if that is just a typo?

Also the buying price on the open market is the broker's commission only plus a £1 P.T.M. levy. No 0.5% tax. At least that's what it cost me when I made my original stake.

midgesgalore

[Alaric]

Also the buying price on the open market is the broker's commission only plus a £1 P.T.M. levy. No 0.5% tax. At least that's what it cost me when I made my original stake.

I would imagine the absence of stamp duty is because it's incorporated in Guernsey. Absence of stamp duty is usually a marginally beneficial effect of IPOs and Rights issues, but not in this case.

[PinkDalek]

On a small note aside, my broker gives me until noon on Tuesday 16th of July to commit to taking up the rights issue entitlement. I see it reported as July 12th above which is dividend payment day. I wonder if that is just a typo?

I haven't spotted the RNS itself being linked to previously but this should be it:

https://www.investegate.co.uk/regional- ... 00091084D/

A number of relevant dates appear to be mentioned under the Expected timetable of principal events section (I can't say I fully understand the content but I can see why your broker mentions the 16th but not the noon.):

Recommended latest time for requesting withdrawal of Open Offer Entitlements and Excess Open Offer Entitlements from CREST
4.30 p.m. on 12 July

Recommended latest time and date for depositing Open Offer Entitlements and Excess Open Offer Entitlements into CREST
3.00 p.m. on 15 July

Latest time and date for receipt of Forms of Proxy and receipt of electronic proxy appointments via CREST
10.00 a.m. on 16 July

[richfool]

Well the funds have been taken from my ISA today (16th July), to cover the cost of the shares I requested, though no shares are yet showing on my account.

The question I will need to ponder is, at 12.3% in property REITs, am I now overweight property? Also, to what extent is sentiment on commercial property influenced by the domestic housing market?

[BrummieDave]

Well the funds have been taken from my ISA today (16th July), to cover the cost of the shares I requested, though no shares are yet showing on my account.

The question I will need to ponder is, at 12.3% in property REITs, am I now overweight property? Also, to what extent is sentiment on commercial property influenced by the domestic housing market?

Same here, money has left my ISA today too.

I'm now at almost 4.5% in property, RGL and SLI (so one REIT and one IT), and that's me done.

[SKYSHIP]

BrummieDave - 4.5% in property. If such little conviction, why hold any at all?

Also, if holding anything in the sector, why hold SLI on a 3% NAV premium and a mere 5% yield?

I recommend you at least double up on your RGL holding; and pay part of that with the proceeds from selling SLI.

[richfool]

Well the funds have been taken from my ISA today (16th July), to cover the cost of the shares I requested, though no shares are yet showing on my account.

The question I will need to ponder is, at 12.3% in property REITs, am I now overweight property? Also, to what extent is sentiment on commercial property influenced by the domestic housing market?

Same here, money has left my ISA today too.

I'm now at almost 4.5% in property, RGL and SLI (so one REIT and one IT), and that's me done.

The offer shares, along with the additional shares I requested, have been credited to my account.

[BrummieDave]

Well the funds have been taken from my ISA today (16th July), to cover the cost of the shares I requested, though no shares are yet showing on my account.

The question I will need to ponder is, at 12.3% in property REITs, am I now overweight property? Also, to what extent is sentiment on commercial property influenced by the domestic housing market?

Same here, money has left my ISA today too.

I'm now at almost 4.5% in property, RGL and SLI (so one REIT and one IT), and that's me done.

The offer shares, along with the additional shares I requested, have been credited to my account.

Indeed, me too, Pari Passu Issue no less!

[richfool]

BrummieDave - 4.5% in property. If such little conviction, why hold any at all?

Also, if holding anything in the sector, why hold SLI on a 3% NAV premium and a mere 5% yield?

I recommend you at least double up on your RGL holding; and pay part of that with the proceeds from selling SLI.

Not that I am answering or trying to second guess BrummieDave, but I can see merit in SLI giving greater diversity within the property sector than holding RGL alone. (Discount and premiums to NAV noted).

In fact I hold: SLI, RGL and WHR in that sector.

[BrummieDave]

BrummieDave - 4.5% in property. If such little conviction, why hold any at all?

Also, if holding anything in the sector, why hold SLI on a 3% NAV premium and a mere 5% yield?

I recommend you at least double up on your RGL holding; and pay part of that with the proceeds from selling SLI.

Not that I am answering or trying to second guess BrummieDave, but I can see merit in SLI giving greater diversity within the property sector than holding RGL alone. (Discount and premiums to NAV noted).

In fact I hold: SLI, RGL and WHR in that sector.

Yes, I should have replied to SKYSHIP sooner, thanks for the prompt.

I've posted my IT Portfolio previously and the logic behind my asset allocation and selected ITs (and REIT); it comprises 85% equities (50:50 UK/International, and noting that many of the underlying UK holdings trade globally), about 5% fixed income (all within the Equity Income ITs, not fixed income ITs), and just over 10% other asset based ITs (Renewables, Infrastructure and Property).

I retired at 55, and the natural yield from my ITs supplements a DB pension. I also work part time, around 25 days per year, as a Pension Scheme Trustee.

My IT portfolio gives me the income I require now along with an appropriate prospect of income growth, and I like the balance RGL and SLI gives me within my Property based investments.

[SKYSHIP]

Richfool & Brummie

Firstly, I see since my earlier post SLI has quite sensibly fallen 5% from 94p to 89p. They are still overvalued.

Never, ever buy or hold a propco at an NAV premium. It is an absurdity when a discount is the natural order of things.

Having halved my RGL holding at 108p+, my largest propco holding is now Highcroft (HCFT). Note, I am not a seller of the other half, rather I am looking to buy back in the 105p-107p range.

Comparing SLI with HCFT is a salutary lesson in following winners, not boring losers. Over the past 10yrs since the Crash, HCFT has left SLI for dead in its wake, raising its dividend at a compound 14%pa versus the SLI performance of -2.4%pa. The sp is now 55% higher. Throughout that time HCFT has consistently provided a higher yield – it is now 5.7% v. 5.3%.

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I repeat – sell SLI; and buy more RGL….and of course, add to your sector exposure by also buying a few HCFT.

[BusyBumbleBee]

Never, ever buy or hold a propco at an NAV premium. It is an absurdity when a discount is the natural order of things.

Sound advice, SKYSHIP - but the same used to be said (at least by me!) of preference shares.

[SKYSHIP]

BBB - "...the same used to be said (at least by me!) of preference shares."

Sorry, could you explain.

Are you referring perhaps to a pref share trading at a premium to par as it adjusts higher to falling interest rates?

If so then I'm afraid your comment is incorrect and I'll elucidate once confirmed.

[richfool]

Richfool & Brummie

Firstly, I see since my earlier post SLI has quite sensibly fallen 5% from 94p to 89p. They are still overvalued.

Never, ever buy or hold a propco at an NAV premium. It is an absurdity when a discount is the natural order of things.

Having halved my RGL holding at 108p+, my largest propco holding is now Highcroft (HCFT). Note, I am not a seller of the other half, rather I am looking to buy back in the 105p-107p range.

Comparing SLI with HCFT is a salutary lesson in following winners, not boring losers. Over the past 10yrs since the Crash, HCFT has left SLI for dead in its wake, raising its dividend at a compound 14%pa versus the SLI performance of -2.4%pa. The sp is now 55% higher. Throughout that time HCFT has consistently provided a higher yield – it is now 5.7% v. 5.3%.

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I repeat – sell SLI; and buy more RGL….and of course, add to your sector exposure by also buying a few HCFT.

Thanks for the feedback and comparisons Skyship.

I am not familiar with HCFT and assume it is a property company as opposed to a REIT as I can't find it listed in the Citywire REIT/IT listings. SLI currently shows SP of 89.50p. Premium: 0.20% and yield: 5.33%, (source Hargreaves Lansdown).

According to Citywire* ( HL stats in brackets) the NAV capital performance of SLI over recent years has been:
1 year: 5.9% (-5.5%)
2 years: -- (-3.2%)
3 years: 29.2% (12.33%)
5 years: 65.5% (19.07%)
10 years: 179% (not shown)

RGL figures:
1 year: 17.2% (12.55%)
2 years: 31.4% (3.47%)
3 years: not shown (6.07%)

*The Citywire figures are I suspect as at 19/04/19.

HL does not show the past performance figures for HCFT.

RGL in turn shows (source HL): SP: 106.20p. 4.59% discount and yield: 7.59%.

Point taken re comparison between RGL and SLI. Though I do keep in mind that the yield may well be a reflection of the risk.

I am currently overweight RGL compared to SLI (and WHR my other prop co) but will take a closer look at all of these over the next week or so. Thanks again.

[SKYSHIP]

Richfool

My advice is always do the research to come up with your own stats. Never, ever rely on broker stats and certainly not Citywire stats. You have to go to the NEWS from ADVFN and look at the actual company statements to then back up all and every assumption.

# HCFT is indeed a REIT

http://www.highcroftplc.com/

# RGL has a limited history as it only listed 3yrs ago!

[richfool]

Never, ever buy or hold a propco at an NAV premium. It is an absurdity when a discount is the natural order of things.

What about Primary Health Properties (PHP), which I also hold? It is at a premium to NAV of c 25% (yield: c 4.00%), after a period of good growth. (20% growth over the last 6 months. 17.3% growth over 1 year. 18% over 2 years. 56% over 5 years). PHP is in a special sector of the property market - investing in such as Doctor's surgeries. Sometimes premiums to NAV develop for particular reasons. I bought in a few years back, when it wasn't at a high premium. I wouldn't propose to sell PHP just because it was trading at a very high premium, unless I became aware of some adverse information affecting that sector (such as JC proposing to nationalise it!).