Comments on: Stock Gumshoe Contest — Win $100 For Your Idea

By: Thomas Beyer

Thomas Beyer — Wed, 25 Mar 2009 16:21:55 +0000

How sustainable is this 10% IGW REIT distribution and ever increasing valuation in light of FALLING commercial rents and FALLING commercial shopping center valuations ?

Consider: a shopping center with a NOI (net operating income) of $600,000 and a yield (or CAP rate) of 6% used to be worth $10M. Now, assuming a flat rent (a big if !!) and higher mortgage rates for shopping centres the yield would be 8%, or a valuation of $7.5M.

Assuming a mortgage of $5M, the equity would drop from $5M to $2.5M .. a 50% drop in equity (or unit value) .. NOT an increase !!

If you give me $100,000 I too can give you 20% .. no problems .. for 5 years .. then oops .. we have a problem !

Ask yourself if a 10% distribution is attainable from cash-flow of properties alone .. or does it have to be augmented by re-finance of (falling !!) asset values and cash by new investors ?

By: Ryan

Ryan — Sat, 31 Jan 2009 23:27:26 +0000

I’m feeling pretty good right about now.

By: ken

ken — Sat, 08 Nov 2008 05:27:23 +0000

dividend to be suspended http://www.reuters.com/article/marketsNews/idINBNG39181320081105?rpc=44

By: Nan

Nan — Sat, 01 Nov 2008 23:37:26 +0000

Two green thumbs up for your post Charlie! Our investment in our hens has probably given us a 600% return! LOL. But lately a big rat snake is swallowing some profits, still, we’re beating the pants off the S&P.

By: vicky caskey

vicky caskey — Tue, 28 Oct 2008 18:08:36 +0000

Thanks Wayne