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Post by scepticalinvestor on Nov 2, 2020 10:42:16 GMT
Hi, I was hoping someone could help me understand some of the components of the recent per-property disclosures taking the one below as an example. 
Now, from what PP say, the disclosure is on a cash basis "The numbers are unaudited management information and have been prepared on a cash accounting basis."
What does the 'Voids and Arrears' component represent? Surely any void periods or unpaid rent will simply reflect in a lower gross rent figure? Or am I missing something obvious here?
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Post by longjohn on Nov 2, 2020 13:48:29 GMT
My take on this is that Voids and Arrears are shown in the wrong place. I'm assuming Gross Rent really is gross and that the display should look like this -
Income
Gross Rent .......... 51671
Voids and arrears .... 9166
Rent Received ..... = 42505
with all the expenses placed underneath.
I'd also like a better breakdown of service charges, 3rd party costs and repairs and maintenance.
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Post by overthehill on Nov 9, 2020 10:48:55 GMT
Hi, I was hoping someone could help me understand some of the components of the recent per-property disclosures taking the one below as an example.
Now, from what PP say, the disclosure is on a cash basis "The numbers are unaudited management information and have been prepared on a cash accounting basis."
What does the 'Voids and Arrears' component represent? Surely any void periods or unpaid rent will simply reflect in a lower gross rent figure? Or am I missing something obvious here?
Voids and arrears is just an expense, an amount which is meant to cover just that. It has always be shown as a prediction which was never high enough but it makes the predicted net dividend look better when the property is purchased. It is probably the biggest contributory factor to annual surplus deficits across the properties. I agree there should be more detail on 3 of those categories. Repairs and maintenance covers thngs like grass cutting and gardening when there isn't any...
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Post by andrewrt on Dec 6, 2020 0:23:10 GMT
My take on this is that Voids and Arrears are shown in the wrong place. I'm assuming Gross Rent really is gross and that the display should look like this -
Income
Gross Rent .......... 51671
Voids and arrears .... 9166
Rent Received ..... = 42505
Yes that's my take too. So when they say "gross rent" what they mean is "rent they would have received if the property had been fully tenanted and everyone had paid what was due".
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beh
Member of DD Central
Posts: 175 
Likes: 77
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Post by beh on Dec 18, 2020 19:03:44 GMT
Maybe it's just seeing what's happened to some other platforms but PP seem to have handled themselves relatively well this year? Reading the latest (December) portfolio update I'm surprisingly relaxed. Will be very intresting to see how they get on with selling some of the properties.
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Post by andrewrt on Dec 27, 2020 17:53:07 GMT
Maybe it's just seeing what's happened to some other platforms but PP seem to have handled themselves relatively well this year? Reading the latest (December) portfolio update I'm surprisingly relaxed. Will be very intresting to see how they get on with selling some of the properties. I'm reasonably ok with how they've performed and the decisions they've made. On the positive: - they kept themselves afloat (albeit largely thanks to the AUM which cost them huge goodwill) - they avoided any property fire sales, through good decisions on mortgage payment holidays, suspending dividends and (more problematically) using the cash reserves to cross-liquidise properties On the negative, they say when the tide goes out you discover who has been swimming naked. This certainly applies here: - actual revenue has been a shock in many cases (should have been disclosed before) - many properties were paying unsustainable dividends - now we get to the five year point, we are discovering that the RICS values look unlikely to be realised - secondary market is trading at a huge discount, spreads are wide and volumes thin - valuations haven't been updated for a very long time - no real justification apart from them not liking the results! - now that valuations are frozen, you can really see the impact of those large initial fees which amortized over time: Share Valuation Index is now at 98.91, a record low All in all, a mixed bag. Could certainly have been worse!
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