TSX:CHP.UN - Post by User
Post by
materialsgirlon Jul 23, 2021 5:42pm
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Post# 33597599
Thank you onparol for a useful post
Thank you onparol for a useful postTwo items;
1 As with all REITs like this one, zero value is attached to
spare land until they get permits and then the value is still
lowballed.
This is a hidden gem in CRR.un REI.un CRT.un and others
as well
BUT real value will surface over future years.
2 Asset mix will change
Now future
Retail 76% shrink a little as Industrial/Apartments grow
70% in 8 years ???
69% in 10 years???
Industrial 15% grow towards 18%
higher property values
additional new large warehouses
Office 8% shrink towards 6% and then 5%
due to growth of other segments
and possible sale of 2 buildings
Apartments 1% grow to 5% (10,000 suites)
3 Cap rates. Many valued the assets using a 6% cap rate a year
ago.
CIBC now uses 5.75% and Canaccord 5.5%
The changes mean that they think the value of properties has risen
4 Payout
This has been as flat as Saskatchewan for half a decade
It may rise a little in 2021-2025 but not by too much
5. Leverage. In my opinion they have far too little debt.
We should have a 1:1 debt to equity ratio
Money is so cheap. We can get better leverage.
However analysts (unwisely) love low debt. The sentiment
may be a hangover from bygone days when debt was expensive.
6. The Industrial industry segment is hot in Alberta and on fire elsewhere.
Choice REIT will never get appraised by applying full value to this segment. They could sell the Industrial Properties at a 30% premium to
NAV if the chose to do so. This will not happen for a decade or more.
Industrial is tangled into Retail a little bit as it owns Loblaw warehouses
Good news will be flowing like lava for two decades.
mat