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British Land (BLND)

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Gengulphus
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Re: British Land (BLND)

#341545

Postby Gengulphus » September 20th, 2020, 6:29 pm

Arborbridge wrote:
Gengulphus wrote:
Arborbridge wrote:... With a TR which has usually hovered in mid double figures (the highest being 20%) and is now more or less zero% from 2009, ...

How have you calculated that "more or less zero% from 2009" TR figure? Looking at a long-term share chart (e.g. https://www.londonstockexchange.com/sto ... mpany-page with "Max" time period selected), the share price seems to be about the same as it was in 2009 - so I could understand it as a capital return figure, but British Land has paid out dividends totalling nearly 300p per share since then, so its total return since 2009 is substantially higher than 0%.

I don't have time to look into that just now to give a full reply, but maybe it is because my holding wasn't bought as a single shot in 2009. Subesequent purchases are presumable showing a loss on capital.

Thanks - I can see now that I'd misread you as saying that "they" (British Land, mentioned just before my quote) have experienced that total return, when you meant that "I" (you yourself, mentioned just after it) have experienced it. No need for a fuller reply!

Arborbridge wrote:I've usually added a rider to XIRR discussions that the results is almost completely individual, dependent as it is on the investor's actions. It is not just a marker of the share in question, but also of the efficacy of the technique of the person investing.

Agreed - but note that rate-of-return calculations can be done in a way that just depends on the starting and ending dates and not on the details of any individual's investing: basically, you just use an assumed purchase of say 1000 shares (*) on the starting date, dividends that go ex-dividend on those shares between the starting date and the ending date, and an assumed sale on the ending date. What tripped me up here is not the absence of a rider, but the fact that your statement could be read quite easily as either being about the company's rate of return calculated in that way for British Land shares from 2009 to 2020, or about your personal rate of return on your various purchases dating from 2009 - and I read it the wrong way.

(*) The answer doesn't depend on the number of shares in principle - but with small numbers of shares, rounding errors might make a noticeable difference.

Gengulphus

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Re: British Land (BLND)

#341565

Postby 88V8 » September 20th, 2020, 8:34 pm

Dod101 wrote:....same outfit and well worthwhile if you have not done it already to take a look at their website so as to understand the comments being made by amongst other TMF.


TMF comment on the increased stake from BAM.... 'this looks more like a vote of confidence than an offer to bail investors out.'

You're right, there is risk, given the amount of retail in BPY's portfolio and the unknowns surrounding our future shopping habits. My guess is that on the whole we'll get back to all our bad old habits. Well. I'll look into BPY further tomorrow.

V8

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Re: British Land (BLND)

#341614

Postby Arborbridge » September 21st, 2020, 7:37 am

88V8 wrote:
Dod101 wrote:....same outfit and well worthwhile if you have not done it already to take a look at their website so as to understand the comments being made by amongst other TMF.


TMF comment on the increased stake from BAM.... 'this looks more like a vote of confidence than an offer to bail investors out.'

You're right, there is risk, given the amount of retail in BPY's portfolio and the unknowns surrounding our future shopping habits. My guess is that on the whole we'll get back to all our bad old habits. Well. I'll look into BPY further tomorrow.

V8


TMF comment on the increased stake from BAM.... 'this looks more like a vote of confidence than an offer to bail investors out.'


I'm hoping that's the case, and would be the better one for me. I doubt they would "bail investor's out"! How sweet of them :roll: to offer us such a lifeline from the kindness of their own hearts. Not an opportunist move, naturally :) .

Dod101
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Re: British Land (BLND)

#341630

Postby Dod101 » September 21st, 2020, 8:49 am

Of course it is an opportunistic move. I guess TMF were being ironic or whatever as I am sure you are as well. Were I a shareholder in B Land I would be happy though that someone was coming along to relieve me of the shares.

BTW on a more serious note Brookfield BPY is their property partnership or at least their property vehicle. I read somewhere that that is not the vehicle for a foreign shareholder to by as it would mean a very complicated tax return or whatever so I suggest that 88V8 takes a look at the whole enterprise and were he to buy he should I think buy the parent, Brookfield Asset Management (which to me has a number of very interesting investments besides property.

Dod

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Re: British Land (BLND)

#341644

Postby 88V8 » September 21st, 2020, 9:34 am

Dod101 wrote:...should I think buy the parent, Brookfield Asset Management (which to me has a number of very interesting investments besides property.

The parent BAM is huge.
But the first thing that leaps out at me is a p/e of 31 and a yield of 1.4%.

Yes, I do curse the 'foreign' section of my tax return, and I'm not sure a yield of 1.4% will persuade me to add to it.

What positives are you seeing?

V8

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Re: British Land (BLND)

#341652

Postby SalvorHardin » September 21st, 2020, 10:06 am

Dod101 wrote:Of course it is an opportunistic move. I guess TMF were being ironic or whatever as I am sure you are as well. Were I a shareholder in B Land I would be happy though that someone was coming along to relieve me of the shares.

BTW on a more serious note Brookfield BPY is their property partnership or at least their property vehicle. I read somewhere that that is not the vehicle for a foreign shareholder to by as it would mean a very complicated tax return or whatever so I suggest that 88V8 takes a look at the whole enterprise and were he to buy he should I think buy the parent, Brookfield Asset Management (which to me has a number of very interesting investments besides property.

Yes, there is a huge tax warning about Brookfield Property Partners. Its shares are shares in a limited partnership, as are the other quoted Brookfield subsidiaries, which means that British investors have the joy of a K-1 form and have to submit an American (or Canadian) tax return. That's a lot more work than the foreign income section of a British tax return. It's a royal pain in the derriere from what I've heard.

There is a Brookfield Property REIT, which I believe doesn't have the K-1 problem (it's a subsidiary of BPY - I don't know any more than that as I don't follow the Brookfield subsidiaries).

Brookfield Asset Management has normal shares, so there's no K-1 (yippee!). BAM is a capital growth vehicle, not an income vehicle. Investors are much more concerned with funds from operations (FFO) than PE ratios. FFO is favoured for American property and infrastructure companies (and most Canadian investors like to use it). This is because American property companies use the GAAP accounting standard, which forces the value of properties in the accounts to be: Purchase price plus Amount spent on improvements minus all Accumulated Depreciation.

This means that any increases in the value of properties don't show up in the accounts until the property is sold, so the PE ratio is horribly misleading by British and Canadian standards (which use NAV estimates and incorporate changes in NAV into the profit and loss account). BAM uses IFRS so its accounts are closer to those of a British company, but it promotes FFO instead of PE as its preferred measure.

Anyway back to British Land. Brookfield has a reputation for buying when others are heading for the hills. It's got a very patient management, most of whom have a lot of skin in the game thanks to their large shareholdings, with a lot of experience in global real estate, infrastructure and reneweable energy investments.

IMHO British Land is the sort of acquisition that Brookfield likes to make, though I would not expect a massive premium to the current share price.

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Re: British Land (BLND)

#341658

Postby Arborbridge » September 21st, 2020, 10:24 am

Dod101 wrote: Were I a shareholder in B Land I would be happy though that someone was coming along to relieve me of the shares.

Dod


Well, I'm certainly not going to be happy if this turns out to be an opportunitstic purchase "relieving me" of the probability of an inproved return from BLND for the small input from me of some patience.

The reasons for my not feeling joyful are flagged up here, by SalvorHardin. He sums it up nicely:

Brookfield has a reputation for buying when others are heading for the hills. It's got a very patient management, most of whom have a lot of skin in the game thanks to their large shareholdings, with a lot of experience in global real estate, infrastructure and reneweable energy investments.

IMHO British Land is the sort of acquisition that Brookfield likes to make, though I would not expect a massive premium to the current share price.


Arb.

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Re: British Land (BLND)

#341666

Postby Dod101 » September 21st, 2020, 10:38 am

Firstly, many thanks to SH for providing the flesh to my meagre bones. I am a mere bystander at the moment in Brookfield but have read a lot of stuff on their website and am certainly attracted to it and may well invest once I get some funds together.

To answer 88V8, I am attracted to their infrastructure and renewables investments as well as their real estate. As far as B Land is concerned, as a standalone investment it has not proved to be very rewarding but I must accept that Brookfield knows a lot more than I do and in any case it is, and even if they buy 100% of it, will remain, a relatively small proportion of their assets. They claim assets of $550 billion and say they currently have $77 billion available for investment. They seem a bit like Berkshire Hathaway in its hay day. I emphasise that I am not currently an investor but I recommend you take a look at their website.

And to Arb, if the Directors of B Land cannot make decent profits for shareholders, then they should step aside for those who might be able to. That is how capitalism works and how most western economies progress.

Dod

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Re: British Land (BLND)

#341669

Postby Dod101 » September 21st, 2020, 10:53 am

And another thing. I have always preferred the GAAP accounting to the more recent IFRS which certainly for a property company distorts the reported profit often quite significantly. I have nothing against reporting current NAV but just do not put increases or otherwise through the P & L Account. You cannot pay dividends from an unrealised capital gain. That is though modern accounting for good or ill and there are arguments for both methods.

Dod

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Re: British Land (BLND)

#341673

Postby idpickering » September 21st, 2020, 11:12 am

It’s been interesting reading the last few messages. Tbh I think some are overthinking things. I haven’t held BLND for a while now, and with the share down 5.66% as I type, in a falling market, I’m glad I don’t. Either way, I wouldn’t worry about things I can’t control. With the market as it is today, it’s a day to step away from our computers and do something else. My purchases scheduled for tomorrow, BP., and RDSB, are still going to happen. I’m glad I seem to be buying them on the cheap, for a long term buy and hold. It would’ve been easy to get distracted by all the cheap shares on offer currently, but I’m keeping my blinkers on, and thinking of the long term.

Ian.

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Re: British Land (BLND)

#341680

Postby Arborbridge » September 21st, 2020, 11:33 am

Dod101 wrote:And to Arb, if the Directors of B Land cannot make decent profits for shareholders, then they should step aside for those who might be able to. That is how capitalism works and how most western economies progress.

Dod


BLND were making a decent return for shareholders until Covid changed matters, which may well be temporary, or may well take some time for management to adjust their holdings to. Taking my figures to the end of last year (thus ruling out Covid, but including Brexit problems) I've been receiving a decent but not excessive yield, a dividend increasing at above RPI and a total return measured by XIRR of 8.9%. How can you characterise that as a failure for management?: I'd say it was a near ideal HYP company. Not too flashy, increasing dividends and a decent return on my capital for when I pop my clogs.

In any case, BAM won't make any difference unless they have some useful ideas for evolution of the company which are superior to those of the existingboard, and if it comes to a complete buy-out, they most certainly won't make a decent profit for me as an existing shareholder. No, they aren't buying into the company not because it's a failure, but because the shareprice has given them an opportunity to buy into a company with a good future in some solid investments.

Perhaps what we should be taking from that is that BLND is currently a good buy.


Arb.

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Re: British Land (BLND)

#341682

Postby Dod101 » September 21st, 2020, 11:39 am

Interesting comments Arb. As I think I said earlier on this thread, I have never made anything from B Land or for that matter Land Securities. I have held both at various time over the last 5 years or so. It does of course depend on timing and the period over which we are measuring the returns. Good for you and I wish you well.

Dod

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Re: British Land (BLND)

#341754

Postby Dod101 » September 21st, 2020, 4:41 pm

Dod101 wrote:Interesting comments Arb. As I think I said earlier on this thread, I have never made anything from B Land or for that matter Land Securities. I have held both at various time over the last 5 years or so. It does of course depend on timing and the period over which we are measuring the returns. Good for you and I wish you well.

Dod


I should have said 25 years, not 5 years, not that it matters very much no, I guess.

Dod

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Re: British Land (BLND)

#341806

Postby Arborbridge » September 21st, 2020, 8:10 pm

Dod101 wrote:
Dod101 wrote:Interesting comments Arb. As I think I said earlier on this thread, I have never made anything from B Land or for that matter Land Securities. I have held both at various time over the last 5 years or so. It does of course depend on timing and the period over which we are measuring the returns. Good for you and I wish you well.

Dod


I should have said 25 years, not 5 years, not that it matters very much no, I guess.

Dod


Well, it has been a weirdly volatile share which gets nowhere! I guess if one played the highs and lows correctly one could have made a lot of money, but getting it wrong would have been a disaster. Since this is a notable low, perhaps the lesson from history is to buy more 8-)

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Re: British Land (BLND)

#341810

Postby 88V8 » September 21st, 2020, 8:19 pm

Arborbridge wrote:Since this is a notable low, perhaps the lesson from history is to buy more

So TJH prospers by selling his winners, Arb will make money by buying his losers :)

I remember when the lifts in some department stores had operators - Going Down!

V8

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Re: British Land (BLND)

#341849

Postby Arborbridge » September 22nd, 2020, 7:21 am

88V8 wrote:
Arborbridge wrote:Since this is a notable low, perhaps the lesson from history is to buy more

So TJH prospers by selling his winners, Arb will make money by buying his losers :)

I remember when the lifts in some department stores had operators - Going Down!

V8


That's a point I've made many times.
HYP is an unconventional strategy, especially when it comes to topups, because it goes against the grain of normal investment practice. Selling, or even trimming, one's winners and adding to shares which have fallen, is the very opposite of what we are normally advised.

However, it has also been pointed out that "normal" investment strategy is the oppposite of what happens in other instances in life: we normally want to buy things which are cheaper rather than those which have gone up price. Investment is a strange game, but the rationale for buying shares with a rising price is quite simple - as Thatcher said "you can't beat the market" - so buying when the momentum is with a share is the most common practice.

HYP is quite different and is somewhat similar to a value strategy, but as we know, value can take a long time to "out" and many HYPers have fallen foul of this, especially when we've bought what is only an apparent bargain. Which is why we set up a series of safety factors to mitigate the risk, including - as here - trimming to keep our shares within bounds.



Arb.

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Re: British Land (BLND)

#341913

Postby tjh290633 » September 22nd, 2020, 11:17 am

88V8 wrote:
Arborbridge wrote:Since this is a notable low, perhaps the lesson from history is to buy more

So TJH prospers by selling his winners, Arb will make money by buying his losers :)

I remember when the lifts in some department stores had operators - Going Down!

V8

You will have noted that when I trim a rising value share, the cash realised is reinvested in lower value shares, usually paying higher dividends. You could call them losers, but they are still paying out. That is why I gave BLND a miss until they have made their next announcement about dividends going forward. Being a REIT, I expect that to be positive to some extent.

TJH


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