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

RE:RE:Crunching the numbers

[Reece1986b]

Manji doesn't seem particularly worried or hurried to me and like you said, Manji is more informed than we are on how Artis asset sales and demand for Artis assets is proceeding. I don't think the right approach is to sell office assets at very high cap rates. Office properties are badly out of favor and we would be selling for what are likely near cycle lows whereas good prices at or near full NAV can be obtained for the industrial and retail assets. Artis could sell the industrial and retail assets, using the proceeds to pay down debt. Artis could then mortgage the largely unencumbered Canadian office assets to fund a large SIB. Maybe the Artis unit price remains depressed because office REITs are presently out of favor however Artis would now have a 8%+ very sustainable distribution which would make waiting for office REIT sentiment to change agreeable in my opinion. 

SNAKEYBOY wrote: Its my view that only Mr Manji truly knows the "value"of artis.  As he has inbound unsolicited requests, and has seen how many buyers came to the table for the 300m disposed of to date, as well as more insider information with regards to commercial real estate in general.  Will some offices in minessota and colorado be sold anywhere *near FMV for the 7% cap rate or whatever it is, or will they need to write them down 15, 20% or  more.

If Manji still wanted to play the "long game" then the easiest middleground is a 150-200m SIB.  Offer it for $8 bucks. 20m shares vanish. It then becomes more takeout friendly.