jester
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Post by jester on May 1, 2024 21:41:52 GMT
Almost 6yrs since I set up this thread ..... and my basket of REITS have been a disaster, rivalling P2P unbelievably!
Down across the board for the period, many 50% and worst cases: NewRiver REIT down 65% Regional REIT down 75%
So the question is do I cut my losses are reinvest at these much lower prices!
Anyone else invest in REITS?
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benaj
Member of DD Central
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Post by benaj on May 2, 2024 5:40:05 GMT
The only UK REIT I got heavily involved was UKDPL. Complete disaster. It seems the theme is the same, the manager always talk about the rent and retention rate, but never mentions their real plan delivering positive total return for investors. Rent got eaten by debt and other costs. Never see a dividend from UKDPL.
I shouldn’t have got involved in the first place with those kind of people in charge.
Second thought, if they know how to sell “assets” like the knighted “state MSM” twin brothers making billions from turning boarding houses into hotels, buying the luxury hotels in the capital, that could be a very different picture.
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Post by overthehill on May 2, 2024 10:50:27 GMT
My advice is stay clear of REITs including the one that gets promoted in this forum. Even the honest and totally transparent ones are for sophisticated full time investors. They are like absolute return funds with their eye watering hidden and upfront charges, finding a good one is like finding the Koh-i-Noor in a diamond mine.
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Post by mostlywrong on May 2, 2024 14:22:04 GMT
A well timed question when the FTSE-250 shows UKCM and SHED in the current top 10!
UKCM is there because BBOX is taking them over and investors at the AGM have just agreed to the transaction. But I have no idea why SHED has suddenly burst into life.
The recent problem with REITs is two-fold; debt and working from home which have severely damaged investors' confidence in the business models.
A lot of REITs are, therefore, trading at huge discounts but are still paying good dividends. Whether that is sustainable if interest rates stay where they are is debatable.
I suspect that the big boys are casting their eyes over the discounts and doing their sums before pouncing. Price discrepancies like these do not appear very often.
Disclosure.
I hold BBOX and have done for some time.
I have just checked and my first purchase was @ 101p in Dec 2013.
That was as a result of reading an article in the Mail on Sunday. I checked and found that the wealth manager, Quilter, was a major shareholder which sounded good to me.
Current yield = 4.8% pa.
I hold 3 tranches in my ISA (so no tax issues) and the IRR ranges from 5.4% to 14.8% pa.
Quicken shows my XIRR is in the high 30s as I have bought and sold several times.
I like BBOX for another reason; I can drive along the motorway and play "spot the box".
It might be a daft way of looking at it but it has to be a lot better than my small holding in a helium mine in down-town Tanzania!
Having written that, I do not fully understand why BBOX is buying UKCM and I will monitor the SP carefully.
If I was playing "spot the target", I thought that BBOX would go after EBOX/BOXE which is really down on its luck (~60% of NAV) in sunny Europe.
MW
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Post by overthehill on May 2, 2024 15:42:49 GMT
If you bought BBOX exactly 5 years ago , then your cumulative return would be 2.75%.
The charges are 2% pa, most equity funds are between 0.5% and 1.25%
The net assets are apparently 5B but shares at 20% discount don't agree. HL doesn't show where or how the money is invested, direct property or other property companies or other REITs etc. Would need to go digging.
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Post by mostlywrong on May 2, 2024 15:53:16 GMT
The other aspect of REITs is that some brokers class them as "complex instruments" and you have to jump through hoops to buy them.
My broker makes me read a document and tick several boxes every 2-3 years.
Chuckle time:
I have previously considered buying BOXE/EBOX which is the European version of BBOX.
Both shares are traded in Sterling on the UK stock market. I cannot remember which way round it is, but one share pays dividends in Sterling and one in Euros.
I can use the trading platform to buy the Euro denominated version but I have to ring the trading desk to buy the Sterling version. Daft.
Luckily, that little quirk stopped me buying that share and saved me from a huge drop in the SP. Phew.
MW
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Post by mostlywrong on May 7, 2024 11:20:58 GMT
If you bought BBOX exactly 5 years ago , then your cumulative return would be 2.75%.
The charges are 2% pa, most equity funds are between 0.5% and 1.25%
The net assets are apparently 5B but shares at 20% discount don't agree. HL doesn't show where or how the money is invested, direct property or other property companies or other REITs etc. Would need to go digging.
Thanks for linking to the BBOX page on HL.
I had forgotten that HL. offers basic data on shares. HL. shows annual costs of 2.09%. Sharepad shows annual costs of 1.6%. Which is correct? I know not. But I understand that the way in which those costs are calculated is the subject of much discussion in the wider investment trust world. Comparing the 5 year data on HL. with my own experience, one of my tranches of BBOX, purchased in Feb 2019 and held since then shows IRR = 7.6% pa. The current yield is 4.8% pa and it is the dividends that make the difference. I have seen various figures of around 2.9% pa for the average annual CPI over the last 10-15 years, so I am content with that level of return. The assets of BBOX are listed, complete with descriptions, at: www.tritaxbigbox.co.uk/portfolio/As I wrote last week, I can drive around the UK and eyeball the assets... What I cannot see is how well BBOX manages its debt, especially as it is now taking over UKCM. We shall see. When discussing REITs, one of the usual culprits mentioned is PHP which owns lots of medical facilities in the UK and Eire. Last weekend's FT had an article on the CEO, Mr Hynam, who runs the company. In the article, he claimed that almost 100% of the current debt is fixed for 7 years and that the inflation linked leases would kick in soon, improving profitability. With a bit of luck, that will also hold true for BBOX. I do not hold PHP. I also note that a new REIT is coming to market. It is claimed that the REIT wants to raise £500m which it will invest in assets trading at a discount. As most REITs claim much the same thing, I am surprised to find yet another competitor entering the fray but, hey, what do I know? Dr Google will help: Special Opportunities REIT REITs aren't for everybody, especially with the tax issues but, all in all, the world of REITs looks as if it might survive the savaging of the last 2-3 years. MW
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Post by mostlywrong on Jun 6, 2024 10:05:23 GMT
Following on from my last post, the Special Opportunities REIT appears to be on the launch pad.
Today's Telegraph's Questor column covers it but it is behind a paywall and I do not have access!
Remember that, unless you are a tax return ninja, my opinion is that you should only hold REITs in tax-efficient accounts.
MW
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Jun 6, 2024 10:57:47 GMT
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Post by mostlywrong on Jun 6, 2024 14:22:47 GMT
Thank you for that.
I note that the journalist details one of the reasons behind the poor performance of REITs over the past couple of years; insurers dumping property from their newly acquired pension schemes. And all leading back to the Ms Truss & Mr Kwarteng gilt debacle. Interesting. I have not heard that one!
MW
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