Author Topic: LAACZ - LA Athletic Co  (Read 4828 times)

BG2008

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Re: LAACZ - LA Athletic Co
« Reply #20 on: March 20, 2018, 06:17:33 PM »
This is a pretty good representation of the club. Renovations are pretty new.  The difference of when I was there is that there were people in the spaces rather than it being empty. 
https://www.discoverlosangeles.com/blog/los-angeles-athletic-club-hotel-champions?utm_source=Facebook&utm_medium=post&utm_campaign=SocialMedia



Spekulatius

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Re: LAACZ - LA Athletic Co
« Reply #21 on: March 21, 2018, 04:22:43 AM »
This is a pretty good representation of the club. Renovations are pretty new.  The difference of when I was there is that there were people in the spaces rather than it being empty. 
https://www.discoverlosangeles.com/blog/los-angeles-athletic-club-hotel-champions?utm_source=Facebook&utm_medium=post&utm_campaign=SocialMedia

That‘s a pretty awesome club. I would rather be member of this club in the 1920 Art Deco style with a storied history, rather than a new and maybe more practical but generic Equinox club.

I think they will keeping because it is their legacy. If they develop the building, it will probably become a new place somewhere. Anything wrong with this either, because I think these sort of things have a real and enduring brand value.
To be a realist, one has to believe in miracles.

Deepdive

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Re: LAACZ - LA Athletic Co
« Reply #22 on: March 25, 2018, 07:25:45 PM »
Posted this a while back - here's a presentation on the company from Rhizome Partners, I think it's definitely worth a look.

Spekulatius

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Re: LAACZ - LA Athletic Co
« Reply #23 on: March 25, 2018, 07:56:19 PM »
It’s listed confidential, so hopefully Bill is Ok with posting it here.

One should note that recent results have been poor due to cost increasing faster than revenues. Their annual report will be published on 4/1 (probably coming in by mail a few days earlier) and they hopefully will shed some light into this trend.

I have a seizable stake (for me) since 2012 and I agree, this is a great LT investment.
To be a realist, one has to believe in miracles.

BG2008

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Re: LAACZ - LA Athletic Co
« Reply #24 on: April 09, 2018, 05:07:51 PM »
2017 Annual Reports Out

Consolidated revenues grew by 5% to $81 million, driven by increased self-storage revenue in all regions.

Storage West grew from 52 to 56 self-storage facilities in 2017, as four newly constructed stores came on line – three in the Houston market and one in Phoenix. Significant startup costs are
 associated with newly opened self-storage facilities, including staffing, marketing and depreciation, while revenues are low during the beginning of the lease-up period. As occupancy increases, rents reach and then pass the break-even level, revenues offset expenses, and the property begins to generate profits.

The Houston market is extremely competitive, and we are still growing into our capacity there. But in September 2017, nearly 1,000 new customers – many of whom were dealing with the effects of the hurricane – chose Storage West Houston. The average occupancy of our five newest Houston stores nearly doubled from 26% to 49% in the space of just a few weeks.  By year end, all of the new stores reached break- even occupancy, a level far greater than we would normally expect so early in the lifecycle of new properties.

Bought back 777 shares or 1.5% of the float


Og

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Re: LAACZ - LA Athletic Co
« Reply #25 on: April 10, 2018, 12:16:22 PM »
Does anybody here have a relationship with management or have spoken to them? Something that I wonder about is whether LAACO makes sense being part of a larger self-storage management company. LAACO is clearly run for the benefit of unitholders but my concern is that there's a lot of low hanging fruit being left on the table being a stand-alone company. If I was running one of the larger SS co's, I'd much rather buy LAACO to expand my portfolio than purchase SS through a broker in the private market. I was speaking to my business broker about LAACO last week and he said there's no way he could ever find anything that cheaply valued in the private market. Also, margins would instantly expand (hence the low hanging fruit) through a more favorable cost structure. Correct me if I'm wrong but I would imagine the reason margins are higher at one of the larger publicly traded SS companies is due to the fact that as size increases, expenses don't rise nearly as quickly.

Would love to hear other input on this.

BG2008

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Re: LAACZ - LA Athletic Co
« Reply #26 on: April 10, 2018, 01:03:28 PM »
Does anybody here have a relationship with management or have spoken to them? Something that I wonder about is whether LAACO makes sense being part of a larger self-storage management company. LAACO is clearly run for the benefit of unitholders but my concern is that there's a lot of low hanging fruit being left on the table being a stand-alone company. If I was running one of the larger SS co's, I'd much rather buy LAACO to expand my portfolio than purchase SS through a broker in the private market. I was speaking to my business broker about LAACO last week and he said there's no way he could ever find anything that cheaply valued in the private market. Also, margins would instantly expand (hence the low hanging fruit) through a more favorable cost structure. Correct me if I'm wrong but I would imagine the reason margins are higher at one of the larger publicly traded SS companies is due to the fact that as size increases, expenses don't rise nearly as quickly.

Would love to hear other input on this.

Take a number and get on the queue  :P   

Yes to most of your questions.  I doubt the management will sell.  Some hedge fund manager offered a take private years ago.  I think if they offer $4,000-$5,000 a share, they may.  The structure is what it is.  If you want to own RE and don't have to do a lot of work, this is an awesome investment.  If you want a quick IRR, selling to a PSA would obviously make sense.     
« Last Edit: April 10, 2018, 01:06:58 PM by BG2008 »