What are you buying today?

[fareastwarriors]

bought more $CLPR at $5.50...

it's worth something right?

[Gregmal]

7 minutes ago, fareastwarriors said:

bought more $CLPR at $5.50...

it's worth something right?

Crime is surging and they’re indicting political foes and charging security guards who get shot with murder….they’re earning every ounce of future pain in that city, and have no one to fault but themselves. 
 

Id honestly rather pay $7 for Clipper after seeing a massive buyback than $5 with the Bistricers just continuing the status quo. Show us you care….

[no_free_lunch]

I am planning an extended trading break.  Rather than start yet another thread thought I'd ask here. Where would you guys park your money?  I'm Canadian with assets split into us and canada.  I suspect the answer I vanguard etfs but doesn't hurt to ask.

Edited April 3, 2023 by no_free_lunch

[Luca]

34 minutes ago, no_free_lunch said:

I am planning an extended trading break.  Rather than start yet another thread thought I'd ask here. Where would you guys park your money?  I'm Canadian with assets split into us and canada.  I suspect the answer I vanguard etfs but doesn't hurt to ask.

Vanguard All World, Set it and forget it! Its something you can own, if it doesnt exist anymore, civilization wont

[CorpRaider]

4 hours ago, Gregmal said:

Crime is surging and they’re indicting political foes and charging security guards who get shot with murder….they’re earning every ounce of future pain in that city, and have no one to fault but themselves. 
 

Id honestly rather pay $7 for Clipper after seeing a massive buyback than $5 with the Bistricers just continuing the status quo. Show us you care….

If that is why it's selling off I'm all good with my GTC limit order that I apparently had outstanding getting filled today.

Edited April 3, 2023 by CorpRaider

[Gregmal]

7 minutes ago, CorpRaider said:

If that is why it's selling off I'm all good with my GTC limit order that I apparently had outstanding getting filled today.

I don’t think anyone knows for sure but same stuff @thepupil mentioned a few years ago when we were all smashing these sorta names. They’re ugly ducklings, if the duckling never gets pretty, or gets uglier, theres little stomach for stuff like this, especially when the market gets fickle. That’s why we need to see a meaningful corporate action from management, which I’m not sure is coming. 

[CorpRaider]

I see they just issued a bunch of LTIP units last week, but I was scared there's some rent regulation scuttlebutt pre-news that I'm missing.

[thepupil]

5 hours ago, Gregmal said:

Crime is surging and they’re indicting political foes and charging security guards who get shot with murder….they’re earning every ounce of future pain in that city, and have no one to fault but themselves. 
 

Id honestly rather pay $7 for Clipper after seeing a massive buyback than $5 with the Bistricers just continuing the status quo. Show us you care….

 

A buyback is the absolute last thing CLPR needs. CLPR is a subscale highly leveraged, illiquid and inconsequential company relegated to the small crap value backwater of the securities market. 
 

there is 1 institutional holder (13f filer) who has gained enough conviction to invest >1% of its portfolio in CLPR.

 

a buyback would, in my opinion, solve absolutely nothing and would not act as some sort of long lost catalyst. 

My view on CLPR remains unchanged. It’s cheap, own a little, let it sit there, don’t stress too much about it or really expect much of anything from them

 

It’ll probably work out over a long time. I’m down to 1% from its underperformance and my own neglect of it. Maybe I’ll bring her to 2% since we’re in the 5’s.
 

[Gregmal]

2 minutes ago, thepupil said:

buyback would, in my opinion, solve absolutely nothing and would not act as some sort of long lost catalyst. 

My view on CLPR remains unchanged. It’s cheap, own a little, let it sit there, don’t stress too much about it or really expect much of anything from them

 

It’ll probably work out over a long time. I’m down to 1% from its underperformance and my own neglect of it. Maybe I’ll bring her to 2% since we’re in the 5’s.

The first paragraph to me validates the reason to dabble with the last two paragraphs. FRPH or FIZZ is the model. Show me you give a shit on allocation. There many different things I can point to with the FRP or FIZZ teams and profiles that seam ugly but there’s just as many where I can say they create value and care about shareholder value. Is there anything you can point to with CLPR that shows management gives two hoots? 
 

Im perfectly fine owning illiquid and even private stuff if everyone is aligned. But I need to know they’re aligned.

[thepupil]

Quote

 But I need to know they’re aligned.

 

"Aligned" can mean and not mean so many things. I own CLPR in my IRA. I have no tax considerations. The Bistricers are NY residents. That's a misalignment and difference in incentives. I have 1% of my wealth and none of my reputation/status in society/etc on the line with respect to CLPR. They have a much larger % of their money and rep. That's misalignment. I am a passive shareholder. for them it's the family biz for several generations and many decades. I don't think anyone is truly "aligned" with a management team. 

 

Do they care that the stock is at $5.50? Probably. they' would probaby rather it be $15 than $5.50. Does that mean they're perfectly aligned? Nope. they are low basis taxable multigenerational owners of RE with substantial wealth and assets outside of the CLPR entity. they're not well aligned. 

 

To me there's a spectrum of alignment. they don't seem like crooks actively working against shareholders, but also don't jump off the page as being spectacular value creators who really care about the stock. @BG2008 thinks they're better than they appear. I struggle to see that. but he does more in depth work (to a very big degree)

[BG2008]

36 minutes ago, thepupil said:

 

"Aligned" can mean and not mean so many things. I own CLPR in my IRA. I have no tax considerations. The Bistricers are NY residents. That's a misalignment and difference in incentives. I have 1% of my wealth and none of my reputation/status in society/etc on the line with respect to CLPR. They have a much larger % of their money and rep. That's misalignment. I am a passive shareholder. for them it's the family biz for several generations and many decades. I don't think anyone is truly "aligned" with a management team. 

 

Do they care that the stock is at $5.50? Probably. they' would probaby rather it be $15 than $5.50. Does that mean they're perfectly aligned? Nope. they are low basis taxable multigenerational owners of RE with substantial wealth and assets outside of the CLPR entity. they're not well aligned. 

 

To me there's a spectrum of alignment. they don't seem like crooks actively working against shareholders, but also don't jump off the page as being spectacular value creators who really care about the stock. @BG2008 thinks they're better than they appear. I struggle to see that. but he does more in depth work (to a very big degree)

 

I'm not going to convince anyone on this name which is why I stopped talking about it. All that Sunbelt hoorahh, now it is facing a bunch of new supply. This is how one creates value in NYC residential. Who the F gives a damn about the opinion of @Gregmal some Jersey Trash or @thepupil some know it all from the Mid Atlantic who bench mark the company against other mega REITs. If you own half of a company, you try hard to make sure you don't do something to lose it all. You keep owning more RE over time. Which they have done without diluting themselves aside from the initial IPO. 

 

The funny thing is that everyone bitches about NYC landlords. But most multigeneration NYC landlords are wealthier than you, me, and Gregmal combined. So just keep owning more dirt in NYC and things tend to work out. People bitch and moan about NYC this and that. I'm a lifer. Leave it or take it. 

 

Now on the decent management skill. They just built a new MF to a 7% cap according to them. Will cash out $30mm from new loan if it hits the stabilized yield. They make sure all debts are non-course with no cross collateralization. 

 

Any of you asshats try to run this business and you'll probably get your ass handed to you. 

 

Alignment or mis alignment, I don't know, you get a 7% yield while they lease up buildings. It's not where I want the stock to trade. But here we are. It is what it is. If you want, you can create your own share buyback. 

 

Again, no one will believe me. So who cares. Someone of you need to try to pull off the financing they did in May 2020 with NYCB and in Feb of this year with 1010 Pacific. Those are master strokes. Probably never gets a bid, yada yada. But you get your 7% yield. 

[thepupil]

Cool, I hope 1010 comes in at a 7% yield. that would, in my view, be the first example of a purchase that created value in CLPR's time as a public company. 

 

I feel like each of these has a story, but collectively a simple LQA NOI / gross book test displays very little evidence of any kind of value creation (in contrast to say FRPH or any development arm of a multifamily blue chip REIT w/ like 1/10 the risk profile in terms of liqudiity/leverage/etc). 

 

I think the stock is cheap though. 

 

[thepupil]

like what's up with Clover House? Non rent control, 95% occupied and putting up <$1mm/quarter...on $146mm of 2017 cost....how does that happen? 

 

typing all that out made me question my 1% position....like it just looks terrible. 

 

Debt Yields look pretty bad....

 

4% at Flatbush, 5.6% at Tribeca House, 7.0% at Aspen, 4.7% at Clover, 6.6% at 10 W 65.

 

 

Edited April 4, 2023 by thepupil

[Dinar]

@thepupil, I think Covid hit them pretty hard.  Flatbush was on a NOI 20MM run-rate in 2019, and then Covid 19 and all of the restrictions re rent increases, evictions, and also higher vacancies hit them.

10 West 65 is bad, although there are a lot of air rights there.  I think the other problem that it and Clover have is a lot of leases signed in 2020 and early 2021.  So once those leases get marked to market...

Also, I think that you made a mistake regarding the interest rates.  the debt at Tribeca house is 4.51%, not 5.6%.  

Aspen is 3.68% not 7.0%.

Flatbush is 3.125% through may 2027

Clover is 3.53% to December 2029

 

[thepupil]

Debt yield = NOI / debt. the cap rate on a building at which equity is a zero. So if Flatbush has $13mm of NOI on $300mm of debt, debt yield = 4% = equity in building worthless unless NOI increases.

google “debt yield CMBS” very common CRE lending term/metric. 

I’m calculating the debt yield at building level and they all just kind of suck. Now maturities are well staggered so there’s still time for NOI to go up (which I think it will but am surprised at how long it’s taking)
 

so yea I feel like Covid was obviously a problem just kind of surprised we’re still not seeing “the recovery” in the 4Q 2022 results 

Edited April 4, 2023 by thepupil

[Dinar]

33 minutes ago, thepupil said:

Debt yield = NOI / debt. the cap rate on a building at which equity is a zero. So if Flatbush has $13mm of NOI on $300mm of debt, debt yield = 4% = equity in building worthless unless NOI increases.

google “debt yield CMBS” very common CRE lending term/metric. 

I’m calculating the debt yield at building level and they all just kind of suck. Now maturities are well staggered so there’s still time for NOI to go up (which I think it will but am surprised at how long it’s taking)
 

so yea I feel like Covid was obviously a problem just kind of surprised we’re still not seeing “the recovery” in the 4Q 2022 results 

Thank you.  I will give you an example: a friend rents an apartment at 424 west end avenue in Manhattan, and he has been there for a decade.  He signed a renewal lease in fall of 2020 (to start January of 2021) at 25% discount to rent he was paying previously. A few months ago (in the fall of 2022), he signed a renewal lease with a 35% increase, bringing him essentially to where he was in 2019 prior to pandemic.  

[Gregmal]

Idk but while I’m sure all else equal these guys prefer their stock trade at $15 vs $5, if it’s worth $15 and trading at $5 you buyback stock. If you’re building real long term per share value, it’s a no brainer. If you can develop with 100% upside, buybacks are still the right move at $5. That’s the owner operator mentality. If you’re just collecting dirt or growing Sq/ft or unit #, at the expense of other stuff, what’s the point? If you’re swimming upstream(NY, microcap REIT, etc) you need something working for you, proactively. That’s all. AIV can buyback stock all day between $5-7…with a $12 NAV that gets scoffed at. But Clipper with a $12-15 NAV can’t be bothered?

Edited April 4, 2023 by Gregmal

[thepupil]

7 hours ago, Gregmal said:

Idk but while I’m sure all else equal these guys prefer their stock trade at $15 vs $5, if it’s worth $15 and trading at $5 you buyback stock. If you’re building real long term per share value, it’s a no brainer. If you can develop with 100% upside, buybacks are still the right move at $5. That’s the owner operator mentality. If you’re just collecting dirt or growing Sq/ft or unit #, at the expense of other stuff, what’s the point? If you’re swimming upstream(NY, microcap REIT, etc) you need something working for you, proactively. That’s all. AIV can buyback stock all day between $5-7…with a $12 NAV that gets scoffed at. But Clipper with a $12-15 NAV can’t be bothered?

We’ll have to agree to disagree here. I think a buyback is potentially value destructive given the balance sheet. If I was running the company, I’d want to be sure every building is in a  Good place first, may even make snes to cut the divvy. 
 

looking at the situation, if I was I. Charge I’d cut divvy to $0 with a pledge to pay out  taxable income for REIT tax compliance. Buyback would in no way be in the cards for me. 

Edited April 4, 2023 by thepupil

[Gregmal]

1 hour ago, thepupil said:

We’ll have to agree to disagree here. I think a buyback is potentially value destructive given the balance sheet. If I was running the company, I’d want to be sure every building is in a  Good place first, may even make snes to cut the divvy. 

Yea I’m not @BG2008 close to this so maybe that’s part of it, but I just don’t view the company as distressed and I don’t buy that they’ll have any trouble tapping the debt markets on their core stuff. So when the market gives the picture you’re severely distressed, and you’re not, sitting around doing nothing isn’t my preferred plan of action. 

[thepupil]

I agree with you IF and WHEN NOI goes up, but if each building keeps performing as they did last year/Q and rates are at current or higher levels in ‘27/‘28, that seems pretty ugly to me. The debt yields are siny

too low, I’d like every building to be at say 7-8% (7% = 78% LTV at a 5.5% cap rate, so I’m not talking blue chip REIT pansy leverage)

 

I frankly hadn’t looked at it in a while and failed to appreciate the degree to which almost every building (except their offices) had such low NOI relative to gross cost and relative to debt. 
 

because of their fragility and inability to retain earnings, REITs should only return more capital than necessary from a position of unquestioned strength.
 

A lot of people hated on Roth in 2019/20 for not buying back stock like SLG…I imagine SLG would like its $3B back. retaining capital in the face of potential stress is the right move. 

Edited April 4, 2023 by thepupil

[no_free_lunch]

18 hours ago, Luca said:

Vanguard All World, Set it and forget it! Its something you can own, if it doesnt exist anymore, civilization wont

Thanks for this.

[Spooky]

18 hours ago, CorpRaider said:

I see they just issued a bunch of LTIP units last week, but I was scared there's some rent regulation scuttlebutt pre-news that I'm missing.

 

There was a recent Odd lots podcast saying that the golden age of being a landlord is over as well as some articles in bloomberg about it.

Edited April 4, 2023 by Spooky

[Saluki]

20 hours ago, no_free_lunch said:

I am planning an extended trading break.  Rather than start yet another thread thought I'd ask here. Where would you guys park your money?  I'm Canadian with assets split into us and canada.  I suspect the answer I vanguard etfs but doesn't hurt to ask.

 

There's a couple of cumulative prefereds that I'm looking at.  Here's one:

 

https://finance.yahoo.com/quote/SRG-PA?p=SRG-PA&.tsrc=fin-srch

 

it's at $23.17 with a $25 liquidation preference.  currently a 7.58% dividend at this price.  Seritage is in a kind of run off mode now and selling off the non-core assets to pay down debt and are open to selling off the entire company. I fell like I'm watching someone defuse a bomb while the timer ticks down.  Assuming the common survives and stabilizes long enough for someone to buy what's left and they call the preferreds, you get that dividend plus another 8% ($23.17x 1.08 = $25) when they close you out at par. If it happens soon, it's not a bad place to park your money.  There are people who are long the common, so maybe this would appeal to them, because if the common survives, then this is money good, but it's a lot of uncertainty. You will get your $25 before the common equity holders get anything, but if there is something that really goes sidways, the debt holders will get paid out first and that $25 is not guaranteed if there is nothing to pay it with. 

 

I'm looking at another cumalative preferred too, much smaller and  less debt, and yielding 9% but haven't had time to read the 10-k yet so I don't want to mention it yet. 

[formthirteen]

AAPL and NVDA puts

 

[gfp]

3 minutes ago, formthirteen said:

AAPL and NVDA puts

 

 

Ha!  No thoughts on NVDA personally, but I can't be the only one out there that has had a big 'ole downtrend line drawn on Apple for over a year and there went the stock price right into it and stopped going up.  Look out if it breaks higher though.  It looks like a popular line in the sand to draw.