IPL - Investore Property

[percy]

There is some discussion on nbr radio
Listen to Hunter’s Corner: Stride forgets its history with flawed offer by NBR Radio #np on #SoundCloud
https://soundcloud.com/nbr-radio/hun...h-flawed-offer

Thank you for the link.
I do respect Tim Hunter's view,and will not bother with this IPO.

[McGyro]

Thanks for the link. Much appreciated.

[Joshuatree]

An investment of just under 1 mill gives me an annual return of 64k which is equivalent to 96k taxable as I am a 33% marginal taxpayer, so a nit's-nat under 10%. Current value is 1,270,000 so a lower return on current value. I'll take your comments aboard and start saving for a copy of the NBR.

Thanks fp although i always ignore shareholding numbers posted by anyone and think its generally unprofessional to do so;( just my opinion ) althoughi don't believe you are big noting or out to impress however..
Thats a great example of buy and hold, there f/p,with your G/Yield now re 10%; fantastic.I have 1 aussie stock like that; TIX that is giving me the same %( no franking as its stapled ) from buying and holding a while .
Some would look at the value of your portfolio now and say well whats the return you are getting on your value now($1.27 mill) and thats the fig to work with(Snappity methinks but i disagree ; the yield on your original investment; i believe for income its all about being in a great company that steadily year after year grows the div at a low risk; the prob being that these stocks can be priced at high multiples and seldom cheap.The Craigs prop article re price compression in prop stocks suggests now is not the time to build a portfolio of prop stocks though as folks have chased these yields down putting s/p at high multiples. Averaging in over a period of time may be a good option. Thanks for sharing,JT

[fungus pudding]

Thanks fp although i always ignore shareholding numbers posted by anyone and think its generally unprofessional to do so;( just my opinion ) althoughi don't believe you are big noting or out to impress however..
Thats a great example of buy and hold, there f/p,with your G/Yield now re 10%; fantastic.I have 1 aussie stock like that; TIX that is giving me the same %( no franking as its stapled ) from buying and holding a while .
Some would look at the value of your portfolio now and say well whats the return you are getting on your value now($1.27 mill) and thats the fig to work with(Snappity methinks

I very deliberately post values occasionally in the hope that others will. It gives weight to their comments - nothing to do with big-noting.
I know the value is the figure to work with, but I'd rather put my energy into building income - buy and get on with the next purchase by stacking up income producing assets. That's just my way, I do not like selling things that earn reasonable money.
Besides that, I don't want to blemish my tax status as a non-trader. Not the ultimate perhaps, but dead easy for someone like me who knows nothing about the share market, but has great faith in commercial real estate. I couldn't bring myself to invest in the dime a dozen listed widget manufacturers.
Also I think of my lpts as just another building, but without the management hassle, the inevitable vacancy to deal with, let alone the expense of reletting. The odd bit of maintenance etc. Those things are okay when you're young and energetic but the risk spread among hundreds of buildings, and thousands of tenants makes this a sensible set up as I approach my dotage.

[troyvdh]

JT with all due respect....re it being unprofessional to declare holdings....I find that quite bizarre.Isnt it not normal practice ...in most if not all commercial circles..to disclose ...surely...especially financial commentators.Its my practice to look,at any disclosure first in order to determine the validity of same.Again...it was my practice to ask any sharebroker ...when discussing shares to buy or sell..how many he/she held.Normally they none...nix that's when I stopped doing business with them.cheers troy

[Joshuatree]

I very deliberately post values occasionally in the hope that others will. It gives weight to their comments - nothing to do with big-noting.
I know the value is the figure to work with, but I'd rather put my energy into building income - buy and get on with the next purchase by stacking up income producing assets. That's just my way, I do not like selling things that earn reasonable money.
Besides that, I don't want to blemish my tax status as a non-trader. Not the ultimate perhaps, but dead easy for someone like me who knows nothing about the share market, but has great faith in commercial real estate. I couldn't bring myself to invest in the dime a dozen listed widget manufacturers.
Also I think of my lpts as just another building, but without the management hassle, the inevitable vacancy to deal with, let alone the expense of reletting. The odd bit of maintenance etc. Those things are okay when you're young and energetic but the risk spread among hundreds of buildings, and thousands of tenants makes this a sensible set up as I approach my dotage.

Building income is sensible esp as we get older; you've got a great example for all to see fp.Im slowly slowly moving that way but i love the hunt, the searching the excitement of finding something new to get my teeth into , throw ideas around with friends and maybe take the plunge; not ready to let go of that and have all income stocks yet but i will at some point

Any one taking up Investore then;interest seems lukewarm on here?. Yields and pricing near NTA the positives; external management and quality of buildings; & price paid for them not so good ?Brokers putting in numbers beginning tomorrow.

[Joshuatree]

A summary•Thanks , Noodles,axe,RRR PT and FP(for the filler et all

Investore's interest expense representsapproximately 29% of revenue in FY18. Managingdebt and interest rates are a key driver ofInvestore's profitability. ( will do well as long as interest rates stay low ) but.....

Exposure to significant tenant: General Distributors Limited ("GDL") is Investore's largest tenant constitutingapproximately 84% of Investore's Contract Rental as at 30 April 2016. If GDL's performance materiallydecreases or if GDL fails to meet its lease obligations, this could affect Investore. (PS axe thinks that if 84% of revenue if coming
from one customer they have your n*ts in a very tight grip

when it comes to negotiating rent increases.)

Long term leases of 15 years for Countdown stores good and they want to grow the portfolio.(i think)

Quality of Countdown props etc. Bayleys syndicated some of the Countdown props including a newish one in Tauranga; are we being offered the Tired doggies old as 26 years.Average age of all buildings re 14 years.

Management structure and fees. The BIG negative with external manger you can't get rid of.Fees higher than other LPT's. Benefits Stride.

Leverage higher than other LPT's, 45 to 50% compared to internal managed 35 to 40%

Overall negative review from Tim Hunter NBR as well as AT LEAST one broker that i know of.https://soundcloud.com/nbr-radio/hun...h-flawed-offer

Priced close to NTA whereas most LPTs are way above currently in the chase for yield which is good. re 7.7 to 8% Gross, est

Did /Are I nvestore paying too much for the countdown portfolio being purchased at a premium to book value from SCP (ASX listed)

Prop values in a bubble or extremely high atm; why buy near a top?

Critique, correction, feedback, agree /disagree thanks JT

[fungus pudding]

A summary•Thanks , Noodles,axe,RRR PT and FP(for the filler et all

Investore's interest expense representsapproximately 29% of revenue in FY18. Managingdebt and interest rates are a key driver ofInvestore's profitability. ( will do well as long as interest rates stay low ) but.....

Exposure to significant tenant: General Distributors Limited ("GDL") is Investore's largest tenant constitutingapproximately 84% of Investore's Contract Rental as at 30 April 2016. If GDL's performance materiallydecreases or if GDL fails to meet its lease obligations, this could affect Investore. (PS axe thinks that if 84% of revenue if coming
from one customer they have your n*ts in a very tight grip

when it comes to negotiating rent increases.)

Long term leases of 15 years for Countdown stores good and they want to grow the portfolio.(i think)

Quality of Countdown props etc. Bayleys syndicated some of the Countdown props including a newish one in Tauranga; are we being offered the Tired doggies old as 26 years.Average age of all buildings re 14 years.

Management structure and fees. The BIG negative with external manger you can't get rid of.Fees higher than other LPT's. Benefits Stride.

Leverage higher than other LPT's, 45 to 50% compared to internal managed 35 to 40%

Overall negative review from Tim Hunter NBR as well as AT LEAST one broker that i know of.https://soundcloud.com/nbr-radio/hun...h-flawed-offer

Priced close to NTA whereas most LPTs are way above currently in the chase for yield which is good. re 7.7 to 8% est

Did /Are I nvestore paying too much for the countdown portfolio being purchased at a premium to book value from SCP (ASX listed)

Prop values in a bubble or extremely high atm; why buy near a top?

All points worth considering. The one that stops me in my tracks is this.

'Management structure and fees. The BIG negative with external manger you can't get rid of.Fees higher than other LPT's. Benefits Stride'.

Don't overlook the benefit to Stride. Maybe I've got it all wrong, but it seems to me that stride may be a better purchase.

[Kelvin]

I currently hold Stride and still undecided on what to do.

If I do nothing, I end up with a tiny amount of Investore shares which isn't ideal.

I could just sell my Stride shares and take a small profit.

I am currently leaning towards buying Investore shares in the IPO to top up the small amount I'll get in the Stride demerger. Although 84% of revenue comes from GDL, Countdown is a pretty stable brand and it's not that easy for them to find new sites for stores so there is some sort of lock-in. But it's still not the most attractive LPT out there, so perhaps I'd be better off buying GMT or VHP

[Kelvin]

Indicative price for Investore was $1.37-$1.49

Final price has been set at $1.49!!!