Artis Real Estate Investment Pref Shs Series E T.AX.PR.E

Alternate Symbol(s): ARESF | T.AX.UN | T.AX.PR.I

Real Estate REIT - Diversified

Artis Real Estate Investment Trust is an unincorporated closed-end REIT based in Canada. Artis REIT's portfolio comprises properties located in Central and Western Canada and select markets throughout the United States, including regions such as Alberta, British Columbia, Manitoba, Ontario, Saskatchewan, Arizona, Minnesota, Colorado, New York, and Wisconsin. The properties are divided into three categories: office, retail, and industrial. The industrial properties account for most of the portfolio, followed by the office properties and the retail properties.

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Comment by Reece1986bon Mar 01, 2023 10:33am

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Post# 35312316

RE:Bigger picture

I think Frankie10 really summarized everything perfectly. I'm looking forward to the conference call. The lower Artis NAV is a good thing. Pretend NAV values aren't helpful and only make it harder to sell assets. Artis needs to sell assets to reduce debt and limit increases in interest expense. Artis has lots of industrial properties that would still be easy enough to sell in this market in order to do so.

Frankie10 wrote: Debt came down roughly $400 million from Q3 to Q4. The issue here now is Manji dosn't seem able to sell properties for the prices he was hoping for. No meaningful new sales since MN industrial sale news. Significant FMV writedown. Without future sales, Artis is very, very tight from a cash flow standpoint (interest expense has exploded to the upside, as to be expected). I believe the new NAV is a true reflection of the current market and the writedowns were required to align carrying value with the value Manji will be able to realize through dispositions. I expect this was done so that future dispositions can be characterized as "sold at IFRS values".

Using net proceeds to buy public REITs rather than pay down debt and buyback units has put Artis in a vulnerable position from a balance sheet percpective.

I think Manji would be the first to tell you, his fatal error here was not reorganzing the debt when he had the chance. Add him to the pile of bodies of those who were screaming PIVOT. My base case is further rate hikes for Canada (as soon as Mar 8 if Tiff had a single brain cell).

Manji is really going to be tested further as rates continue to increase. And he has failed spectacularly so far. Turns out he's just another average guy who got lucky and made a fortune from real estate - nothing special.

Let's see what happens at 1. Hope you boys are having a good morning.