TSX:AX.PR.E - Post by User
Comment by
Reece1986bon Apr 28, 2023 10:32pm
101 Views
Post# 35420471
RE:Any more lower and....
RE:Any more lower and....That is the rationale behind my investment in Artis. Regardless of what AFFO is, the unencumbered public market investments in Dream Office and First Capital are rather easy to value. Likewise, the industrial assets are imo rather easy to sell. The question is merely what kind of discount to NAV would be required to bring that about.
At $6/unit, ~40% of the value of Artis (114 million units times $6 = $684 million market cap) would be the unencumbered public market investments in D and FCR. Now factor in the value of the Cominar preferred units which should be worth around $150 million in 2025. Even if Cominar otherwise has no value, that is still $150 million which represents a further 22% of the $6 Artis market cap of $684 million. We are at ~40%+22%= ~ 62%. We have not account for the industrial properties nor the office/retail properties nor any value Cominar could have outside the preferred units.
*Numbers are not exact but are a good enough ballpark to get the point across. This is not a guarantee it can't go lower however I think it provides peace of mind.
SNAKEYBOY wrote: I'm not sure it makes sense for artis to go much lower regardless of what AFFO is based on the math of the market cap relative to asset base.
Lets say it tanksto $6.00.
- $6.00 x 75 million shares = $450 million market cap.
- Public securities = $300 million
At $6 even its basically implying unit holder equity value of the REIT is only $150 million. That all 120+ properties and Cominar is full on debt.
Bear in mind the Industrial asset value = $700 million which probably can fetch NAV now if needed.
The remaining 7 million shares of the NCIB in the $6's would not be that bad for long term holders.