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Bullboard - Stock Discussion Forum Slate Grocery REIT T.SGR.UN

Alternate Symbol(s):  SRRTF

Slate Grocery REIT (the REIT) is a Canada-based open-ended mutual fund trust. The REIT focuses on acquiring, owning, and leasing a portfolio of grocery-anchored real estate properties. The REIT has a portfolio that spans 15.2 million square feet of GLA and consists of 116 critical real estate properties located in the United States of America. The REIT owns and operates real estate... see more

TSX:SGR.UN - Post Discussion

Slate Grocery REIT > No deal accretion or AFFO per share growth for several qtrs
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Post by logicandinertia on Feb 15, 2023 8:49am

No deal accretion or AFFO per share growth for several qtrs

AFFO per share has flat lined at ~$0.22 per quarter over past several quarters.   Over the past several quarters, revenue is up from $33 million to $51 million while NOI has increased from $24 million to $40.6 million.   The growth has been driven by acquisitions, financed mostly with equity.  


where exactly is the accretion from any of these deals?  It hasn't materialized.


I always worried about these external management structures that they prioritize getting bigger because that is what drives their "asset management fees".     While AFFO per share was flat in 2022 compared to 2021,  asset management fees paid to Slate increased from $6 million in 2021 to $8.5 million in 2022, an increase of 42 percent, after jumping 17 percent in 2021 vs 2020.

while this is  a reasonable yield and held up pretty well thru Covid, previous statements on management calls on deal accretion quite evidently haven't come to fruition.   The only parties experiencing growth in distributions here has been Slate Management (and the bankers doing the equity deals).  Hope this changes going forward.

Comment by theinvestor22 on Feb 15, 2023 11:12am
logicandinertia:  I can't disagree with your commentary in general, but there is one factoid which should influence things going forward.  I've been following the difference between in-place and market rents.  During most of covid, there was about a 1-4% difference.  Over the last couple of quarters, that difference has shot up to over 12% so, if those figures are ...more  
Comment by logicandinertia on Feb 16, 2023 10:25pm
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 ...more  
Comment by CanSiamCyp on Feb 15, 2023 11:54am
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