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

RE:Coincidence?

[Reece1986b]

A $9.00 SIB would mean paying 15 times the annualized AFFO of the most recent Artis quarter ($0.15 for Q3).

This would not benefit Artis unitholders in my opinion unless the intention is to mop up units to reduce the cost for a buyer of the REIT. Interest expense on existing Artis debt means paying 15x AFFO in a SIB would not improve AFFO/unit. Artis would be better off repurchasing units through their NCIB and continuing to repurchase preferred units (perhaps even doing a $20 preferred unit SIB as has been previously suggested here). The uncertainty of where this is all heading is precisely what makes me uncomfortable with Artis at present. I would be much more comfortable if these asset sales were being used to reduce debt.

garyreins wrote: You know, the strategic review was officialy called in August, therefore likely decided upon in June/July by the board.  This is almost impeccable timing with the Dream Office SIB.   I can't help but think Manji took note of that 100m extraction of capital from D.UN by DRM in what was more or less an effortless manner, as they set the price and an amount to pull that recalibrates their risk as an overall income-driven entity.   Im not suggesting this is the end goal but it is definitely a possible scenario that cannot be overloooked.  The Q3 PR did say additional unit buybacks and return capital to shareholders.  Why do we think this means the retail investors, and not the sandpiper group included?  I wouldnt assume privitization is the most likely outcome.  Of course they would also include other measures to make the remaining artis investment have some huge upside by continuing with good capital allocation, but it certainly "returns $ to shareholders" within 3 months and then additional upside when the REIT space recovers.

GLTA