BG2008 Posted January 1, 2020 Share Posted January 1, 2020 Any updates on this? Any news on sale or pre-sale information? Stock price has been under quite a bit of pressure lately. Link to comment Share on other sites More sharing options...
morob Posted January 2, 2020 Share Posted January 2, 2020 time to sell is taking longer so they took on alternative financing in order to pursue their strategy to diversify into income producing assets in NYC metro (predominantly Brooklyn). This new financing looks somewhat expensive and it is unclear they can earn much more on these new investments than the cost of financing. They probably are forced to do this as a bridge to perpetuate the corporate structure while waiting for 77 Greenwich to monetize. Stock still looks cheap here relative to value of 77 Greenwich but hard to expect discount to close quickly over next year as they won't disclose any sales numbers anytime soon (more likely for 2021). I would not expect them to sell 77G under $2000/sqft. Before doing so they would rather start renting some units until market recovers. Overall I would expect NYC resi markets to stabilize between now and 2021. That might be a catalyst of sorts at some point. Link to comment Share on other sites More sharing options...
bobozou Posted January 2, 2020 Share Posted January 2, 2020 Thanks for bringing this up - below are my simple thoughts, but feel free to let me know what I'm missing: Pros: 1) Given mgt's assessment of the value of non 77-Greenwich assets (circa April 2018)+ implied value of 77-greenwich (which is lower than April 2018 estimates, but may still be ~$2K/sqft) + current share price = attractive valuation 2) Recently announced $5M share purchase plan 3) MFP + 3rd Ave are large stakeholders (fwiw) Cons: 1) Management doesn't own significant stock / CEO also seems very highly compensated for $100M valuation (granted, company valuation used to be higher) & activities (buying & developing real estate)? 2) Management track-record (at TPHS) of real-estate deals seem... crappy-to-OK (at best)? A) 237 11th, purchased early 2018 for $81M... currently <50% leased, bc they discovered construction defect... ouch B) 223 North 8th, purchased via JV late 2016 for $69M (50/50)... currently 100% leased... annualized rental revenue is $3.2M (before expenses)... seems 'meh'? C) 250 North 10th, purchased via JV late 2019 for $138M (10/90)... TPHS received financing at 7% to fund this transaction Conclusion: 1) There's probably 'value' today (contingent upon what non-77 properties are worth, and what 77's ultimate sale prices will be) 2) Bigger question is what management plans to do with all that potential 'value'... fear is that they're more interested in building NYC RE empire, rather than finding opportunistic value-enhancing purchases. Correct me if I'm wrong, but the 3 acquisitions completed to-date don't inspire my confidence Link to comment Share on other sites More sharing options...
BG2008 Posted January 2, 2020 Share Posted January 2, 2020 I hate to be a Debbie Downer, but buying NYC multi-family with 7% financing seems like suicide. The appropriate financing is 3-4%. Ouch on the 50% occupancy. That hurts. You can't buy your way into scale with NYC multi-family assets. The way to make money in NYC multi-family is to buy and hold and wait 5-10 years for rent increases. Link to comment Share on other sites More sharing options...
Saluki Posted January 5, 2020 Author Share Posted January 5, 2020 I sold part of my position just before the end of the year to offset some gains I had, for tax purposes. I may buy it back after 31 days if the price hasn't moved and the news isn't out yet on the condo sales at 77 Greenwich, which I think is the catalyst for the stock to move(if it's good). I felt okay with TPHS selling off the odd parcels, since they weren't really factored into the investment thesis, but I hadn't figured on them buying more apartment buildings in Brooklyn. Good idea or not, I don't want to fall victim to thesis creep and that wasn't one of the things I factored into the original investment or risks. I don't like the softening of manhattan condo prices, but I think it still looks like an okay risk/reward setup but I've lightened up my real estate exposure recently (sold HHC right before the drop, BAM and a little SRG) just because I think this bull market is getting long in the tooth and trade wars and bombing foreign countries isn't exactly confidence-building. So my plan (if things looks the same in a couple of weeks) is to buy back up to my original position if things look the same and wait for the results from the condo sales to become public, then re-evaluate. Link to comment Share on other sites More sharing options...
pricingpower Posted January 5, 2020 Share Posted January 5, 2020 For monitoring condo listings in NYC streeteasy.com is solid and supports free email alerts https://streeteasy.com/building/77-greenwich There is a large supply of luxury condo conversions/new construction scheduled for 2020 occupancy in the financial district- 130 william 25 park row 33 beekman 45 park place 125 greenwich 161 maiden lane (one seaport) 77 greenwich 1 wall st 1 Wall St is near 77 Greenwich and has a Whole Foods coming as the commercial tenant, that and the Alamo Drafthouse at Chase Plaza should help make the area feel more residential After monitoring this since pre the bankruptcy I bought my first shares in December as an asset play and looking for a January effect. Future capital allocation is my top concern. Link to comment Share on other sites More sharing options...
BG2008 Posted March 2, 2020 Share Posted March 2, 2020 There appears to be a glut of new Condos https://www.wsj.com/articles/softbanks-fortress-buys-debt-on-troubled-new-york-city-condo-tower-11582984801?mod=hp_major_pos1#cxrecs_s Link to comment Share on other sites More sharing options...
walkie518 Posted March 4, 2020 Share Posted March 4, 2020 There appears to be a glut of new Condos https://www.wsj.com/articles/softbanks-fortress-buys-debt-on-troubled-new-york-city-condo-tower-11582984801?mod=hp_major_pos1#cxrecs_s historically, developers in nyc can't help themselves from building until there is a bust then again, there is so much demand and rates are so low, it's hard to think that more ppl aren't going to buy rather than rent where there is a better probability for cap appreciation ... though, to be fair, NYC RE is not the same kind of an investment as something with a cap rate more than 5... Link to comment Share on other sites More sharing options...
BG2008 Posted April 21, 2020 Share Posted April 21, 2020 Any updates on the amount of condo units that are pre-sold? I want to like this idea, but have stayed away and been happy of that decision so far. One of the concerns that I have is that TPHS doesn't really offer any shareholder value (at the moment to people). NAV discount investment thesis are a dime a dozen in the public markets today. If you can buy Vornado at 1/3 of NAV that pays 7% dividend, why bother with TPHS? You can buy LAACO and get a 5.5% yield that is very safe. You can buy GRIF and they are converting into a REIT and will likely start a small and growing dividend yield. All the other names offers some flavor of real shareholder reward. Link to comment Share on other sites More sharing options...
Gregmal Posted April 21, 2020 Share Posted April 21, 2020 Agreed, I want to like this, but whatever its proposition is there are better propositions in other stuff right now. On a somewhat tangential note, there's been some articles about tons of "distressed real estate" funds being setup all over. Lot of money just waiting. Link to comment Share on other sites More sharing options...
BG2008 Posted January 30, 2021 Share Posted January 30, 2021 Jesus, $3mm of comp paid to CEO, CFO, and CAO. Link to comment Share on other sites More sharing options...
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