BPY 4Q2018 Results were solid with Office Occupancy at 93.5% (up from 92.5% year ago) and Retail Occupancy at 96.5% (up from 96% year ago). Rents for expiring leases were up 8% in office and 11% in retail so we don’t see a retail Armageddon yet. They sold out the US Logistics IDI acquires in 2012-2013 to Quebec Pension Plan for $3.5B which was a 20% IRR and 2.5 times multiple over the 6 years.
They increased dividend by 5% to $1.32 per year. At the $14.92 price of BPY on Dec 24 2018 this is 8.8% dividend yield. BPY at $18.70 today is still a good price and we think the units are at least worth $25. BPY announced a Substantial Issuer Bid (Type of Buyback in Canadian Law) for $500M at prices between $19 and $21 which is good for retiring 2.5% of shares. As of now there are 974M shares ($1.06B shares including dilution from conversion of preferred shares and other convertible securities).
The stock will likely trade at these low valuations over next 1-2 years until they pay down debt from GGP acquisition and until they prove that retail malls can be tuned into multi use properties with office, hotels and apartments.
BPY 4Q2018 Results
BPY 4Q2018 Letter To Unitholders
They increased dividend by 5% to $1.32 per year. At the $14.92 price of BPY on Dec 24 2018 this is 8.8% dividend yield. BPY at $18.70 today is still a good price and we think the units are at least worth $25. BPY announced a Substantial Issuer Bid (Type of Buyback in Canadian Law) for $500M at prices between $19 and $21 which is good for retiring 2.5% of shares. As of now there are 974M shares ($1.06B shares including dilution from conversion of preferred shares and other convertible securities).
The stock will likely trade at these low valuations over next 1-2 years until they pay down debt from GGP acquisition and until they prove that retail malls can be tuned into multi use properties with office, hotels and apartments.
BPY 4Q2018 Results
BPY 4Q2018 Letter To Unitholders
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