Tritax Big Box IPO

bowlhead99

EdGasket wrote: »

CREI (Custodian REIT) is another company in the same business but on a less demanding valuation than BBOX. Might be worth getting some of those instead of more BBOX.

It is in the "same business" in terms of owning and leasing out a portfolio of commercial property.

It is not at all like BBOX's specialism of seeking exclusively "big box" special purpose warehouse/logistics setups of half a million square feet or more which are used as the backbone of a company's distribution strategy. If you invest in Custodian you get exposure to car showrooms and day nurseries and office space. BBOX is not trying to do that.

So, it depends what story you want to buy into, but they are significantly different stories.

balf wrote: »

132p with market price current 134.

Not very tempting really?

David

That is a pretty poor way to evaluate an opportunity.
They are making £150m of brand new shares available, at a fixed price free of stamp duty and commissions - and the £150m is a relatively large amount compared to the market cap and normal trading volumes. The offer process will give people who want the shares the opportunity to buy new shares to support the expansion at a guaranteed price rather than the alternative of buying existing shares in the market.

So the reduced demand to buy second-hand shares at the market price, means that market price will inevitably fall to closer to the new offered placement price as it gets closer to the share issue date. It doesn't mean the offer price is a bad deal.

The 132p is a 7% discount to the prevailing market price when it was announced (accounting for the interim dividend qualification date). Sure, it is now only 2-3p cheaper than buying on market and paying the stamp, because market price fell due to the existence of the new fundraising. But that doesn't scream "avoid buying any shares here there is nothing on offer".

For 132p, you're buying into a company that people thought was worth 145p a week or two ago, with no significant adverse news since, and which will now be able to use the raised funds to make new investments expected to be earnings-enhancing (and the running costs of the company will now be split over a wider pool of capital making it more efficient). It is probably shortsighted to just say "it's not attractive on the basis of the offer price being almost as high as the market price".

It may of course not be attractive on the basis of the other factors I mentioned, like being a supplier of distribution/ logistics hubs in a time where Brexit macroeconomics are likely to hold back GDP and investment for a multi year period.

BLB53

I have put in my order for some shares as I like the set up which is essentially a play on the online shopping revolution. I think this is set to expand and do not see a great deal of downside.

With interest rates at rock bottom and the fall in sterling making a top-up of my Vanguard Lifestrategy unattractive at present, the opportunity to get an income of 4.6% (and the aim of 9% total return) is appealing.

This will be around just under 2% of my total portfolio however so not going overboard!

grey_gym_sock

i hold LMP - another REIT, and with some similarity, in that the focus is mainly on properties for distribution, especially with an eye on the trend for growth in online retail.

i wondered whether BBOX shares would be cheaper, and so whether it might be switching from LMP to BBOX. however, both seem to be priced about 2% or 3% above net asset value, and both yielding c. 4.5% ... so once again i can decide to do nothing

Thrugelmir

Already hold the shares. Have subscribed for the basic entitlement. As like the business model with some growth to come as well. One to hold for the long term as should be a solid cash generator in the years to come.

takesyourchances

Any more thoughts on the Tritax Big Box IT a couple years on from this thread?



I am thinking of adding a couple thousand into this as a small part of my property IT exposure to a different sector. There is so much online distribution being done which looks like it will increase with how shopping online is going.



Also read Tritax are looking at a possible European distribution IT / EuroBox.

cogito

I like BBOX very much for its very clear focus, high quality tenant base, long leases and upward only rent reviews. They also believe that Brexit will be a plus for them. I'll also subscribe to Eurobox when it lists. It looks like a better proposition to me than the similar Aberdeen Standard Life Reit.

takesyourchances

cogito wrote: »

I like BBOX very much for its very clear focus, high quality tenant base, long leases and upward only rent reviews. They also believe that Brexit will be a plus for them. I'll also subscribe to Eurobox when it lists. It looks like a better proposition to me than the similar Aberdeen Standard Life Reit.

I also read their thoughts on Brexit too on Citywire, the sector looks to be solid for the future with the way online retail is going and will also watch out with interest for the Eurobox.



The focus came across to me as well as very clear and I think it suits how online retail is also moving and the tenant base of the companies looks very solid and well spread and can see this fitting in with a diversification within property.

capital0ne

BBOX now 155p - I too went for these at IPO time, up about 20% now - divis reinvested of course.

bowlhead99

capital0ne wrote: »

BBOX now 155p - I too went for these at IPO time, up about 20% now - divis reinvested of course.

If you went for them at IPO time you'd be up 70%+, as the initial public offering was at a pound and there's been 20p+ per share of dividends since...