This might not be true

The CPPIB is confident there will be enough investor appetite to allow it to recover the £250m it lent against the Trafford Centre, which is valued at £1.7bn on Intu’s books. In addition to the CPPIB debt, £690m worth of mortgage-backed securities is secured against the centre.

Adding the two debts together – I have no idea which is senior – that’s £950 million. Is that formerly £1.7 billion asset now worth £950 million in a fire sale?

I would be very much less than certain of that……

8 thoughts on “This might not be true”

  1. The CPPIB debt will be senior to the CMBS.

    The Trafford Centre is one of the better bits of the portfolio, so should fetch more than half its Dec 31 2019 valuation.

  2. The CPPIB debt will be senior to the CMBS.

    Actually, looks like that’s not correct. The 2017 release about the CPPIB funding describes it as a subordinated debt facility.

  3. Makes more sense; by definition the mortgaged debt usually would be.

    Tim, as that’ll be one of the assessments they’ll have carried out, that might suggest you know this market reasonably well?

  4. Know little about it – that’s why I’ve written stock tip articles on Intu. You know, journalists and experts?

  5. Bloke in North Dorset

    Tim,

    Did you see that Sunday Times article about calls for the government and big businesses to get people bank to office work in cities to help cafes, pubs etc in city centres? Sorry, can’t link as I’ve got the dead tree version.

    There’s got to be a seen Vs unseen piece for you to write in that one?

  6. I’ve been told we are going for 35% initial capacity with staggered days etc. and unlikely to be back to full capacity before end of the year, talking to others that seems to be the case for them as well.
    The knock on effect for revenue to the transit system and downtown businesses that rely on office staff will be massive, there’s no tourism either which is a summer bump, and is going to drag on for at least 6 months.
    Also likely not many people will buy monthly passes for transit so as well as loss of revenue it’s going to be more spread out.

  7. INTU? Hold co or (Pr)Op Co? Lending to PropCo is secured by the real estate. Lending to HoldCo, which is bust, isn’t secured by anything other than a prayer as I understand it. Going to be an interesting ride on this one.

    Who’s next?

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