Just starting to look at this, although unfortunately, the disparity with NAV has closed.
* How does the gearing for CLS compare with other real estate firms?
* What percentage of the debts are non-recourse?
* They have a large tax loss being carried forward? After this is exhausted, what will their tax rate be on property sales?
* Their business model appears to be to buy buildings that are under-leased at a 6% cap rate and then lease them up and sell them at under a 4% cap rate. Has this always been their model, or is there something specific about the current environment that makes them prefer this model?
Hi pone,
I'm sure someone with more specific info will be along shortly !
For comparisons with other co's , go to the company page and use the compare facility , plugging in your choice of companies.
AIUI, each property is held in a Special Purpose Vehicle and debt is linked to underlying asset, so no general cross guarantees etc.
Tax Q - no idea.
The business model you describe is the one they've been using for the decade or so that I've been flwg. Their focus appears to be high quality tenants on longish leases, with a longstanding mix of GBP and Euro (+ historically some Sweden), giving a geographic spread. It used to suit the Morstedt family to take income by way of share tenders (rather than dividends) so the company was 'off the radar' for many conventional institutional investors.
HTH, NAI and carry on DYOR
ATB
