Market's view on Warehouse Reit
Published on April 2024
- Concerns are raised about the lack of update on the announced sale of a major development project, with suspicions about selective release of only positive news.
- WHR is highlighted as having a debt issue that they are expected to resolve, although not as affordably as hoped.
- Discussion about WHR’s potential as a takeover target by Segro, questioning if WHR or EBOX has higher debt.
- It is noted that contracted rents are slightly lower than in the previous quarter despite good leasing activity, impacting dividend coverage negatively.
- Positive comments are made about recent financial numbers, suggesting the share price should be higher.
- Speculations are made about the proceeds from a recent sale being used to pay off part of an uncapped revolving credit facility.
- The disposal of two assets above their book value from September 2023 is mentioned, suggesting a need for cash.
- Consolidation in the sector is observed with Bbox acquiring UKCM.
- The acquisition of shares by Tilstone Partners Limited is seen as a strong vote of confidence in Warehouse REIT’s assets.
- Discussion about the dividend coverage at WHR, with suggestions that it might need to be cut despite rental growth and profitable disposals.
- A big change in strategy at Radway is discussed, with a previously planned pre-let falling through and the property now up for sale, indicating possible management disappointment despite good progress on estimated rental values.
- There is optimism about real estate investment trusts narrowing the discount between net asset value and market value as inflation falls.