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

NO CONFIDENCE & BAD STRATEGY

[SNAKEYBOY]

I just dont see how when they had a mountain of debt to renew this year they decided to plow 300 million in public securites, of which they are likely down a bit in DREAM office and maybe breakeven in FCR at best.  All this while AX traded sub $11 in past year.

Seems simple that they should have paid down worst debt and had 80 mil for NCIB.  Then used asset sale funds to buy public securities if their debt and unit price was more stable, not the other way around.  

Lets be realistic Im just not optimistic about 2023 and I can see dispositions being slow and taking longer to close while they try to maintain dividend and liquidity.  These guys just dont have their act together and I dont think the market is going to give them a second chance if Q1 is viewed as "negative" like Q4 was.

[Reece1986b]

The public market investments in Dream Office and First Capital can be sold if necessary and might be perceived as being a preferable way to put money to work in this market since they are more easily converted when sold to liquidity versus preferreds or NCIB or even otherwise paying down debt which may very well be impossible to satisfactorily reverse in this market should liquidity be required.&

[rad10]

Buying REITS on margin......  it's bad enough taking a haircut on this name.  Pity the dude that took the haircut with it on margin..... that stinks.

[SNAKEYBOY]

I dont think so when they are dependent on asset sales to reduce leverage.....nothing wrong with buying D.UN/FCR but it should be priority #3 on the list after DEBT/NCIB is taken care of.  In theory they could buy any publically traded stock saying "its at a good discount" but as DZtrader says then they basically are acting as a stock portfolio manager.  

[junglejames]

You do realize that along with the new "Business Transformation Plan" managment is also in a conflict of interest as they make money everytime they acquire units in other public REITS on behalf of Artis.  And they continue to get paid for subquent years, even if they do nothing else.  Note too that the wording in the notes is not clear if the fees are based on the market value