Ann: June 2022 Valuation Update and June Quarter Distribution, page-21

Each of their properties are on non-recourse loans and various maturities with majority of loans requiring re-financing in 2027 and beyond.

77% of their debt are hedged, which I assume means fixed rate.

So any short term interest rate rise will have a lessen effect on CLW as compared to say a year ago. As long as CLW can keep up with interest repayments, then why would they need to conduct heavily diluted capital raises ? Remember again that 50% of their portfolio is linked to CPI rent reviews and 50% Fixed, which mean their income will increase again this FY.

If you are talking about LVR and NTA dropping heavily, I think yes, LVR will increase and NTA will drop as interest rate rise, but remember there is a huge disconnect between the listed and unlisted commercial markets, Petrol stations and long quality WALE properties leased to ASX listed tenants are in huge demand in the unlisted market and often sell above listed price. You can just do some research and see how many petrol stations are selling above asking price and 10+ offers. So I dont think NTA will drop that heavily and LVR will be less affected, when banks assess the LVR they do look at the market value of these properties and sell history of adjacent/similar properties and can come to a conclusion that they're doing well. Hence there will be less risk of CLW breaching their covenants and need liquidity urgently.

Now, comparing this to 2008, REITs especially ones of CLW's calibre are aware of the market conditions and liquidity issues, where as back then it was a sudden dry of liquidity and fire sales everywhere. This is not the case today.

I will probably put a hold on CLW for now as there are headwinds and risks and there are better opportunities elsewhere, but to say a repeat of 2008 and heavily diluted capital raises, I dont see that as likely.

Lastly, this inflation and recession to be are all man made, with CoVid hitting supply and demand/logistic chain and also the war in Ukraine pushing energy price sky high. CoVid is almost over now and China will surely slowly open its manufacturing to stimulate the economy, Ukraine is not going to last forever.... Hence, inflation will not be sustained. We can already see petrol prices coming down and goods are starting to stablise, I think in the mid term when interest rate starts to stablise, CLW will reverse its current trend and in the mean time, we will still collect our dividend.