ᴡᴇᴇᴋʟʏ ᴜᴘᴅᴀᴛᴇ 2 ꜱᴇᴘᴛᴇᴍʙᴇʀ 2024
A large part of my portfolio is invested in European real estate. I like the sector because it benefits from lower interest rates and because stocks in the sector are reasonably valued.
This week, let’s take a look at portfolio holding Unite Group Plc.
$UTG.L (UNITE Group PLC) is the UK’s largest provider of student housing. The company owns and operates 151 properties in university cities across the UK. 70% of the company’s tenants are from the UK, 30% from abroad.
UK student housing has long been an attractive market for companies to operate in. Demand has not been met by enough supply, leading to a shortfall of 230,000 students beds.
www.savills.co.uk/blog/article/358493/commercial-property/uk-cities-need-much-higher-rates-of-student-housing-delivery.aspx
As a result, student housing rents are increasing 7% this year and are predicted to increase 4-5% a year going forward.
www.unitegroup.com/wp-content/uploads/2024/07/Unite-Group-2024-Interims-presentation-vF.pdf
Because of strong rental growth, Unite’s property portfolio withstood the increase in interest rates since 2022 better than many others. Values decreased in 2023, but only mildly, and are currently increasing at a 7% annual rate. Analysts expect further increases in 2025 and 2026.
Historically, Unite has been valued at 1.1x its net assets on average, reflecting the market’s assessment of favourable supply/demand dynamics in its target market and the expectation that its properties will continue to appreciate.
Applying this multiple to the expected end-2024 net assets of about 1000p per share, we get a target price of 1100p, suggesting 15% upside may be available.
This appears attractive given the high quality of Unite's balance sheet and its track record of creating value for shareholders.
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www.triangulacapital.com... Show More
Thank you for the detailed weekly update. The insights into the European real estate sector, particularly the analysis of Unite Group Plc, are very helpful- Thanks again for keeping us informed!... Show More
Thanks for the analysis! Another European company that will benefit from low interest rates is, in my opinion, $RIO (Rio Tinto PLC ADR)
If the interest rates go lower, companies will have more the possibility to use more debt to produce goods, and to produce something they will need basic materials.... Show More
Thanks for the update Pietari, Again great result and forecast we are with you on this one , just invested more cash with you
Hopefully happy days ahead
Keith
Spain ... Show More
@triangulacapital , grazie per tutti i nuovi aggiornamenti. C'è un minimo consigliato di investimento per copiarti? Cioè per coprire tutti i tuoi movimenti, anche quelli più piccoli... Show More Translate
Unite Group Plc ($UTG.L (UNITE Group PLC)) stands out as a compelling play in the European real estate sector, especially in the UK’s student housing market. With a significant shortfall of 230,000 student beds, demand remains robust, creating a favorable environment for rental growth. The projected... Show More
I like your new style of weekly updates. Sharing your General viel on the market and picking one share you go into detail is great.
@triangulacapital beating his Index is not the best reason to copy you. Beeing honest when you dont and sharing your knowledge is.
The +38% I got since I Started copying... Show More
