Top PickFirst stock in the clip. GLTA
https://www.bnnbloomberg.ca/video/shows/market-call/2024/10/31/andrew-moffs-top-picks-first-capital-realty-chartwell-retirement-residences-and-empire-state-realty-trust/
First Capital Realty (FCR.UN TSX)
First Capital REIT (“First Capital” or the “REIT”) owns or manages over 22 million square feet of grocery anchored, necessity-based retail real estate in Canada’s urban centers, with approximately half of its portfolio located in Toronto. The REIT also has 23 million square feet of potential future development, incremental to the existing retail base. Vision believes this is the highest quality and best-located grocery store-anchored portfolio globally.
In early 2024, First Capital REIT updated its three-year strategic plan with the goal of increasing net asset value (NAV) and funds from operations (FFO) per unit by more than three per cent annually while also reducing debt-to-EBITDA leverage by at least one times. This plan focuses on utilizing First Capital’s expertise in rezoning to add entitlements to current properties and then to monetize up to $1 billion of that excess development density to maximize unitholder value. The selective monetization of these high-density assets, which generate low-income yields, is aimed at enhancing per-unit earnings and bolstering the REIT’s balance sheet strength. First Capital has recently secured an additional $66 million in sales agreements, set to close by early 2025, and divested over $700 million in non-core assets at an average yield below three per cent and a 20 per cent premium to its IFRS values. This disciplined approach has solidified First Capital’s position as one of the top-performing Canadian retail REITs in 2024. Despite this strong performance, the REIT’s units still trade at a 15 per cent discount to their IFRS valuation, which only reflects 29 per cent of the total potential development pipeline. Vision expects that First Capital’s high-quality urban assets and value-driven strategy will continue to drive outperformance.
TOP PICK
First Capital Realty(FCR-T)
31/10/2024
One of his largest holdings. One of the highest-quality grocery-anchored shopping-centre portfolios globally. Trades at upwards of 25% discount to private market value. Management seeking to increase value by selling non-core properties and reducing debt. Yield is 4.8%.
(Analysts’ price target is $20.30)
Property Mngmnt / Investment
Andrew Moffs
$18.00
Owned