Author Topic: SRG - Seritage Growth Properties  (Read 161994 times)

scorpioncapital

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Re: SRG - Seritage Growth Properties
« Reply #10 on: February 12, 2016, 08:25:36 AM »
You know, I'm wondering if a mall tenant to replace Sears could be a large grocery chain like whole foods.

It's not likely across a ton of the portfolio IMO, but there are instances where it is happening check link below:

http://www.seritage.com/retail/property/4588-virginia-beach-blvd/3312644/landing

Good find. My idea is that one criticism is whether malls would be able to find more big time retailers - or even small time retailers in an age of belt-tightening or another recession. Food never goes out of style and I do know several malls that have food stores - access is key, sometimes people want to be able to get to it quickly without going through the whole mall though.



WeiChiLoh

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Re: SRG - Seritage Growth Properties
« Reply #12 on: February 13, 2016, 01:17:31 PM »
i did a rough valuation on SRG and got to a $40 fair value. Seems like the market is pricing this appropriately.

WeiChiLoh

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Re: SRG - Seritage Growth Properties
« Reply #13 on: February 13, 2016, 01:25:02 PM »
i did a rough valuation on SRG and got to a $40 fair value. Seems like the market is pricing this appropriately.

Dependent on 3rd party rental rates though. I used 8.50

scorpioncapital

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Re: SRG - Seritage Growth Properties
« Reply #14 on: February 13, 2016, 01:25:31 PM »
I always like to try to think about what Buffett saw in this. I think it's the ability to reinvest large sums of cash-flow back into capex via the rebuilding and re-leasing at higher prices. This is a pattern he's doing at Berkshire say with the utilities, railroad, etc.. A leveraged business that reinvests most of its profits can be a good business as inflation rises. The debt provides part of the excess return. Furthermore, being a REIT having to distribute 90% of profits, no wonder it's called 'growth properties'. I wonder if in fact the dividend may be very low because they can take all the money and use it. Using money in a business (with the exception of capital investment that only accrues to consumers such as seat upgrades on airplanes or even tech upgrades in cable companies) is quite tax efficient and is sort of like issuing shares for growth, it's the opposite of distributions because you can't find anything to invest in. Self-funded deployment of capital to earn a higher return. In the case of SRG, potentially 2x higher rent.

accutronman

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BTShine

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Re: SRG - Seritage Growth Properties
« Reply #16 on: March 10, 2016, 03:56:00 PM »
Seritage released their Q4 earnings this evening.

http://ir.seritage.com/file/Index?KeyFile=30193007

doughishere

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Re: SRG - Seritage Growth Properties
« Reply #17 on: March 13, 2016, 10:31:03 AM »
Ya'll do know that Buffett has an 8% stake in this right? You should feel pretty good about that if you saw this before.

I think it speaks to what Bruce says on the values of SHLD RE.
« Last Edit: March 13, 2016, 10:35:15 AM by doughishere »

Picasso

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Re: SRG - Seritage Growth Properties
« Reply #18 on: March 13, 2016, 10:54:52 AM »
Actually a lot less than 8%.  There's a bunch of operating units not included in the share count.

moneyball

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Re: SRG - Seritage Growth Properties
« Reply #19 on: March 13, 2016, 11:20:02 AM »
Yeah the 8% of the stockholders equity would work out to be ~4% of total diluted equity