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Mill Residential Reit

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http://www.millresidentialreit.co.uk/

Proposed Members Voluntary Liquidation, Proposed cancellation of admission of Ordinary Shares to trading on AIM and Notice of General Meeting.

http://www.millresidentialreit.co.uk/docs/default-source/regulatory-news/proposed-cancellation-of-admission-to-trading-on-aim-and-trading-update-1.pdf?sfvrsn=4.

That was quick! They only listed last year. Funding constraints!

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interesting

"Trading update

The Company’s unaudited net assets as at 30 September 2015 were £3,209,000, including cash of £765,000, resulting in a net asset value per share as at 30 September 2015 of 91.6 pence.

The Company announces that its wholly-owned subsidiary, Investors in Housing (GP) Limited, has exchanged contracts for the sale of 160 Walnut Tree Close for a cash consideration of approximately £405,000, after costs. The contract is conditional on completion and is expected to complete in the next 10 business days. The net proceeds of this sale will be retained as cash and then distributed to Shareholders in accordance with the proposals included in this announcement regarding the Company’s intention to dispose of its current portfolio.

This property and one other property in the MRR portfolio require refurbishment in order for them to be able to be re-let. The Board has decided that rather than incurring the refurbishment costs the Company should dispose of these properties.

The other property currently has an accounting value of £395,000. At the date of this document, an offer has been accepted on the other property and exchange of contracts is expected shortly. A further announcement will be made at that time.

The combined sales price is in excess of the aggregate value of the two properties as set out in the interim results which were announced on 25 June 2015."

If the buyer of either property is reading this, take heed: I suspect you have a chance to trim your bid back a bit.

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Here is why they can't raise the money they need: from the website

"This initial portfolio has a value of £2.5m with a gross yield of circa. 4.5%."

After fees, management costs etc. that leaves approximately (and it is an approximation) zero for return to investors

Note my previous referrals to starwoodwaypoint as an example of a US firm that does the same as this one (on a bigger scale) and its Q2 acquisitions generating 10.58% yield

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launching a REIT at £3m is ludicrous; given the requirement for broker, NOMAD etc. No surprise that it produces zero free cash. If you looked into the initial offering documents you'll be aware the seed assets included assets from employees.

a professionally managed residential REIT at scale would be a good addition to the rental landscape - purpose built, properly managed, proper customer service, no revenge evictions, longer terms (as not restricted by BTL mortgages) etc

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