Real Estate Credit Investments

[Gostevie]

Moderator Message:
Originally posted on HYP-P board, and now moved here... --MDW1954

Dear Fools,

I today topped up on my holding in Real Estate Credit Investments (RECI.L). I realise it might be a borderline company to post about on this board, but the rules say: REITs and REIT-like investment companies (e.g. infrastructure companies) are perfectly acceptable, so I thought I'd give it a go.

To quote from its Stockopedia page:

"The Investment Policy of the Company is the investment policy for the core segment (Core). In order to achieve its investment objective for the Core, the Company invests and will continue to invest primarily in debt secured by commercial or residential properties in Western Europe and the United Kingdom." So i'd describe it as a REIT-like investment company.

It is Guernsey based, so no stamp duty to pay, and yields over 7%. It is also trading at a discount to NAV of around 6%. Dividends are paid quarterly and have been maintained at the current level for several years.

A recent investor presentation can be found here:

https://www.youtube.com/watch?v=ASpzaJLG878&t=5s

Any comments, bullish or bearish, would be most welcome.

Gostevie

[Wasron]

I hold, but have them in my IT portfolio, rather than my HYP.

Last year’s price decline was significant, but it’s slowly recovered.

They do a job in an income portfolio, but I’m not looking to top them up in the next year or so

Wasron

[MDW1954]

Moderator Message:
Gostevie, sadly I'm going to rule this completely off-topic on the HYP-P board, on two grounds. First, it's a million miles from the "should be a member of FTSE 350" rule. OK, that might not be hard-and-fast, but at £330m, RECI drives a bus through it. Second, (and as you say) RECI doesn't invest in property (as a REIT does), but in quoted instruments etc secured on that property. Sorry, but that makes it an IT. -- MDW1954

[kempiejon]

I was going to add earlier that it's a tiddler, I will look down to the top of the 250, I generally like over £1bn but this example also has had a flat dividend of 3p since 2017, which is not a long enough history but it's nice to see what's in other ponds sometimes evening if I'm not fishing.

[JuanDB]

I hold in my income IT portfolio. Bought fairly recently for the high income and price recovery. Seemed like a pretty safe play. I may trade out if it returns to a premium and there is a discount elsewhere but happy to hold in the meantime.

[csearle]

I hold in my income IT portfolio. Bought fairly recently for the high income and price recovery. Seemed like a pretty safe play. I may trade out if it returns to a premium and there is a discount elsewhere but happy to hold in the meantime.

Probably best to take this conversation elsewhere (guidelines). Thanks. C.

[JuanDB]

Apologies, picked the thread up from the “New Posts” quick link, I incorrectly thought it had been moved to the other board.

Cheers,

Juan

[MDW1954]

Moderator Message:
Sorry, I was in the middle of moving the thread when my wife intervened with offspring news. Thread duly moved. -- MDW1954

[csearle]

Moderator Message:
Sorry, I was in the middle of moving the thread when my wife intervened with offspring news. Thread duly moved. -- MDW1954

Congratulations!!!!

[MDW1954]

Not that sort of "offspring news", thank God, you naughty man.

MDW1954

[Alaric]

Returning to the IT concerned, is it one of the relatively few that make payouts partly as interest rather than dividend? Irrelevant for holders in ISAs and SIPPs, but outside of that, do the distributions count against the £ 1,000 gross interest or the £ 2,000 tax free dividend allowance?

[JuanDB]

Returning to the IT concerned, is it one of the relatively few that make payouts partly as interest rather than dividend? Irrelevant for holders in ISAs and SIPPs, but outside of that, do the distributions count against the £ 1,000 gross interest or the £ 2,000 tax free dividend allowance?

I’m not aware that RECI pays dividends as interest. When I reviewed the KID, and annual presentations prior to purchase it isn’t something I picked up on. Having a scan through just now I can’t see anything to suggest dividends are paid as interest.

I would be quite happy if it were the case as the holding is in my wife’s unsheltered account and her interest allowance is unused.