Slate Grocery REIT Class U Units T.SGR.UN

RE:RE:No deal accretion or AFFO per share growth for several qtrs

[logicandinertia]

Thank you.  You make a number of salient points.  I need to look more closely at the condition of some of SGR's latest acquistions re; your points regarding capex to upgrade properties to hold up rents.  While SGR trumpeted the defensive nature of grocery in their marketing, grocery/supermarkets is only 35% of total rent, and total occupancy still struggles to go north of 93% (93.2% as of last quarter).  

REITs have enjoyed a 40 year tailwind from the secular move down in rates, and the cheap money environment has allowed even the most limited of intellect to make money in real estate.  This game has clearly changed in the past year.

I listened intently to SGR's rationale around its previous deals (and associated capital raising) and even participated in some those deals.  However, with the cost of capital rising and scant evidence that these deals were accretive, I worry that the yield is the only thing protecting unit holders.  As you know, if capital needs to be raised for further deals below book value, then this becomes value destructive for unit holders (while still making money for SLAM).  The gig is up at that point.  Are we there yet (like Slate Office)?  No, but i worry...

Good luck,