I am curious about the Mongolian real estate stock you had. Do you still have it? I can’t find the info on it from your irregular updates
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Hi — yes, I still own shares of this one, and it’s been plummeting over the past several months as commodities fears increased and as banking scandals and continued regulatory uncertainty have continued to depress foreign direct investment in the country.
The company also lost its CFO last week, and if you read between the lines it sounds more or less like Harris Kupperman is a little sick of living in Ulan Baator and they’ve been streamlining the company and will be moving their real estate management operations to Toronto. They are focused now on “high street” retail — trying to buy up the storefronts on what they imagine will be the Fifth Avenue of the capital city in the future. Rents are rising nicely, but their booked revenue for December was at a run rate of less than $2 million per year so it’s going to be a while before they have a reasonable cash flow profile.
You’re really buying this to get real estate assets in a boom town, managed effectively — now that the shares have fallen they’re probably at about 1.5X book value. I’m holding this one as a long-term speculation, so I’m giving the shares a lot of leeway and am fairly sanguine about the fall so far… but I can’t tolerate a complete loss so I will be watching them fairly closely. So much is dependent on the macro picture for Mongolia, and about investor sentiment toward that country — I still think that sentiment is worse than reality, but with bankings scandals hitting the newspaper it’s obviously still a “frontier” investment in the strictest sense of that term. Mongolia is growing fast, is tiny, but is still really the “Wild East”
As I now have some skin in the game, – yes Travis, please keep watching MMGGF closely and let us know of any new developments, OK?
I bought a little more YAK in May, FYI (that’s the Canadian ticker) — noted here: http://www.stockgumshoe.com/2014/05/brazilian-burgers-mongolian-real-estate-africa-and-ligand/