Whilst it may be accepted that Listed Property Companies often trade at a discount to Net Asset Value on public markets, the extreme extent to which this has become the case, particularly since the onset of the Covid-19 pandemic, is striking.
Whilst share prices in a number of such companies have recovered somewhat as the overall market has rallied in recent months, many remain cold-shouldered by Investors and still trade at a significant discount.
Admittedly, the Retail Sector is undoubtedly facing its own pandemic and those companies with property portfolios focussed in the sector are nursing the biggest hit to share values. However, one should not forget that they don’t make land anymore and as Space in our Towns and Cities becomes ever more limited and much of the country’s open land is restricted by man-made planning policy, underlying values of Bricks and Mortar are strongly supported and alternative land uses may prove even more value accretive moving forward.
Many Investors are too frantically chasing the two in the bush to realise the real value of the one in the hand. Watch out for activity in this sector as those in the know take advantage of clear opportunities.