thepupil Posted November 10, 2020 Share Posted November 10, 2020 https://www.goodwinlaw.com/-/media/files/viewpoints/alerts/2016/reit-alert_ownership-limits.pdf?la=en Link to comment Share on other sites More sharing options...
BG2008 Posted November 10, 2020 Share Posted November 10, 2020 https://www.goodwinlaw.com/-/media/files/viewpoints/alerts/2016/reit-alert_ownership-limits.pdf?la=en Pupil coming through once again! Link to comment Share on other sites More sharing options...
thepupil Posted November 10, 2020 Share Posted November 10, 2020 https://www.goodwinlaw.com/-/media/files/viewpoints/alerts/2016/reit-alert_ownership-limits.pdf?la=en Pupil coming through once again! i am most capable of harnessing the power of....google! in other news can we get some accretive deals done or what!?!? GRIF to $70 / reflexivity zone and BERY to $100* is the christmas present we value guys deserve and need. *obviously this is a touch aspirational. Link to comment Share on other sites More sharing options...
bizaro86 Posted November 10, 2020 Share Posted November 10, 2020 Kind of a little granular but was curious if you knew anyway....typically on a REIT conversion/existing structure there are concentration limits and lazily off the top of my head its something like 5 shareholders cant own more than 50%...is this an issue here? The usual workaround there is to just convert some of the big owners to operating partnership interests that are convertible to REIT units to stay under the ownership limits. I'm not a lawyer but I play one in my portfolio, if that's what you were asking. It's pretty common in REIT conversions for some big holders to need to take operating partnership units. Sometimes they include a special class of units in the REIT directly that only include voting rights that go with the operating partnership units so the operating partnership owners can vote on REIT matters directly. If you get a conversion with registration rights, it isn't a big deal for investors to take OP units. There are even some potential tax benefits to be had for the firm (basis step up) if the OP units are converted back to regular REIT securities at a higher price. Thanks! This is very helpful. Lawyer? Link to comment Share on other sites More sharing options...
BG2008 Posted November 11, 2020 Share Posted November 11, 2020 Kind of a little granular but was curious if you knew anyway....typically on a REIT conversion/existing structure there are concentration limits and lazily off the top of my head its something like 5 shareholders cant own more than 50%...is this an issue here? The usual workaround there is to just convert some of the big owners to operating partnership interests that are convertible to REIT units to stay under the ownership limits. Bizzaro, Was there a response? I'm not a lawyer but I play one in my portfolio, if that's what you were asking. It's pretty common in REIT conversions for some big holders to need to take operating partnership units. Sometimes they include a special class of units in the REIT directly that only include voting rights that go with the operating partnership units so the operating partnership owners can vote on REIT matters directly. If you get a conversion with registration rights, it isn't a big deal for investors to take OP units. There are even some potential tax benefits to be had for the firm (basis step up) if the OP units are converted back to regular REIT securities at a higher price. Thanks! This is very helpful. Lawyer? Link to comment Share on other sites More sharing options...
BG2008 Posted November 11, 2020 Share Posted November 11, 2020 What a freaking 180 on corporate communications. Holy Crap! November_Investor_Day_11.11.20_vFINAL.pdf Link to comment Share on other sites More sharing options...
Gregmal Posted November 11, 2020 Share Posted November 11, 2020 OMG lol. I literally chuckled when opening that. Not in a bad or mocking way...but nearly a 100 page slide? I dont think Ive ever seen anything like that from a company of this size. Impressive. Link to comment Share on other sites More sharing options...
villainx Posted November 11, 2020 Share Posted November 11, 2020 What a freaking 180 on corporate communications. Holy Crap! Is this a good or bad response? Link to comment Share on other sites More sharing options...
BG2008 Posted November 11, 2020 Share Posted November 11, 2020 What a freaking 180 on corporate communications. Holy Crap! Is this a good or bad response? Crazy good. Maybe it's because they provided a lot of info that makes it easier for people to "glance at it" and arrive at a NAV calculation. They did a much better job laying out the thesis. The website has bene revamped. Link to comment Share on other sites More sharing options...
bizaro86 Posted November 11, 2020 Share Posted November 11, 2020 Kind of a little granular but was curious if you knew anyway....typically on a REIT conversion/existing structure there are concentration limits and lazily off the top of my head its something like 5 shareholders cant own more than 50%...is this an issue here? The usual workaround there is to just convert some of the big owners to operating partnership interests that are convertible to REIT units to stay under the ownership limits. Thanks! This is very helpful. Lawyer? Sorry, my response got eaten by the quote tags somehow. Trying again. I'm not a lawyer but I play one in my portfolio, if that's what you were asking. It's pretty common in REIT conversions for some big holders to need to take operating partnership units. Sometimes they include a special class of units in the REIT directly that only include voting rights that go with the operating partnership units so the operating partnership owners can vote on REIT matters directly. If you get a conversion with registration rights, it isn't a big deal for investors to take OP units. There are even some potential tax benefits to be had for the firm (basis step up) if the OP units are converted back to regular REIT securities at a higher price. Link to comment Share on other sites More sharing options...
SugarRE Posted November 11, 2020 Share Posted November 11, 2020 I'm reaching out to a few REIT investors to see if this is showing up on any of their radars yet. Any thoughts? Link to comment Share on other sites More sharing options...
BG2008 Posted November 11, 2020 Share Posted November 11, 2020 I'm reaching out to a few REIT investors to see if this is showing up on any of their radars yet. Any thoughts? No idea. GRIF is going to NAREIT this year. Link to comment Share on other sites More sharing options...
SugarRE Posted November 13, 2020 Share Posted November 13, 2020 Too small for Greenstreet, which would be a big win if they could get covered. Link to comment Share on other sites More sharing options...
BG2008 Posted November 23, 2020 Share Posted November 23, 2020 New high today. I wouldn't mind if they were issuing equity via the ATM today. $64-65 price $70 NAV. Higher trading volume will improve liquidity which makes it more invest-able for the bigger guys. Link to comment Share on other sites More sharing options...
BG2008 Posted November 24, 2020 Share Posted November 24, 2020 Not sure how I missed this update. Basically confirming REIT conversion. Stock and cash dividend between $1.77 to $2.12. Stock dividend will likely improve trading liquidity. Cash of $0.55. The cash amount of $0.55 is super interesting. I told the CEO years ago that they need to increase the dividend every year even if it is by a small amount. If you go through this thread, people openly questioned if GRIF was ran for the benefit of the family. But I have noticed that the CEO pays a lot of attention to inputs that I provide as a shareholder. He doesn't always agree, but his actions often reflect what I have shared if my suggestions are reasonable. As the years go on, I am more willing to give him the benefit of the doubt. Maybe that's the share price reaction doing all the talking. Maybe, it's because I have learned that when management give you positive surprises and actually incorporate your suggestions, you should reward them with more loyalty as a shareholder. https://griffinindustrial.com/news/griffin-announces-update-on-reit-conversion-dividend-plans-upcoming-rebranding/#press Found this press release on Twitter of all places Link to comment Share on other sites More sharing options...
cubsfan Posted November 24, 2020 Share Posted November 24, 2020 ^ BG2008 - I've followed GRIF for some time now. You did a terrific job working with management. Kudos to you for all your efforts. Link to comment Share on other sites More sharing options...
villainx Posted November 24, 2020 Share Posted November 24, 2020 So now what?!? Link to comment Share on other sites More sharing options...
Gregmal Posted November 24, 2020 Share Posted November 24, 2020 So now what?!? A congrats to BG for sure and a wish of luck fitting a camel through the eye of a needle trying to pair down 1%+ of a micro cap RE company at full(maybe even a hair overvalued!) FV...something I dont think Ive ever seen anyone do successfully. Usually, its at 80% of FV for these type of names...which sadly is what I ended up selling this for. Anyway, I didnt think he could top FRP on a start to finish basis, but somehow did. Whats the 3rd act now? Link to comment Share on other sites More sharing options...
thepupil Posted November 24, 2020 Share Posted November 24, 2020 gregmal, you can't fully sell GRIF!!!! the more the stock goes up the more undervalued this may be :P pansy trims, take some fruit off the tree, but don't cut it down! Management may start PRINTING shares ;) Link to comment Share on other sites More sharing options...
Gregmal Posted November 24, 2020 Share Posted November 24, 2020 I will say, as a RE investor, the past month has now made me capable of understanding what it feels like to have been a tech investor for the past 10 years! Hopefully we get the same. Link to comment Share on other sites More sharing options...
thepupil Posted November 24, 2020 Share Posted November 24, 2020 ha, unfortunately real estate doesn't have that whole rapidly growing earnings thing going for it... Link to comment Share on other sites More sharing options...
villainx Posted November 24, 2020 Share Posted November 24, 2020 New high today. I wouldn't mind if they were issuing equity via the ATM today. $64-65 price $70 NAV. Higher trading volume will improve liquidity which makes it more invest-able for the bigger guys. Plus the new distribution is supposed to have a stock div component. They've been attacking the float in a number of different ways. Link to comment Share on other sites More sharing options...
BG2008 Posted November 25, 2020 Share Posted November 25, 2020 So now what?!? A congrats to BG for sure and a wish of luck fitting a camel through the eye of a needle trying to pair down 1%+ of a micro cap RE company at full(maybe even a hair overvalued!) FV...something I dont think Ive ever seen anyone do successfully. Usually, its at 80% of FV for these type of names...which sadly is what I ended up selling this for. Anyway, I didnt think he could top FRP on a start to finish basis, but somehow did. Whats the 3rd act now? Greg, Thank you for the kind words. Your kind words a while back got me through this thesis. I guess I am now a bit more seasoned and really understand what some of the old timers are mean when they say that "value can underperform for a long time." If you look at the performance for the first 3 years froma $35 cost basis, this was a low to mid single digit CAGR. And then 3-4 months turns this into a 20-25% CAGR. Tobias Carlisle talks a lot about value staying stagnant and then when performances do come, they come in a very violent way to the upside. The same thing is true for a lot of the office REITs this year. I guess, I have a tendency to buy stuff that are beaten down and unloved. But I have to stick with it being out of favor for a while. I've got a 3rd act loaded and building a 4th act. Almost 25% of my book in those 2 names. I agree with Pupil that this becomes a reflexivity play form here. At double digits of my book today, I have to think about the proper allocation in my portfolio. I am conflicted because it is trading at fair value now more or less. But people seem to love Gordon Dugan. Also, it's much easier to grow a $400mm market cap than a $50bn MC. Link to comment Share on other sites More sharing options...
BG2008 Posted November 25, 2020 Share Posted November 25, 2020 Trimmed 5% to help solve the trading liquidity issue. Watch the stock soar 50% from here because I took a few chips off the table! Probably going to keep at least 60% of my original position to see what Gordon can do. I'm also loading up on Act 4. So there is an alternative use of capital. Link to comment Share on other sites More sharing options...
BG2008 Posted November 25, 2020 Share Posted November 25, 2020 I am in awe of the Gordon DuGan magic. New high of $71.88 on 21,160 shares traded today on a down day in the market. When I grow up, I want to be Gordon DuGan. Link to comment Share on other sites More sharing options...
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