I've been doing some reading up on the NPR/BWP deal and agree...

I've been doing some reading up on the NPR/BWP deal and agree that it's overall a very positive sign for the small to medium REIT sector which needs consolidating to address these crazy NTA discounts. In terms of the comparison to TOT there are some key similarities and differences:

Similarities

Both are small cap REITS although NPR still actually double the size of TOT with a 535 million dollar portfolio

Both have similar WACRs with ours at 5.33 and NPR at 5.1%

Both have gearing ratios that have blown out due to property write downs although NPR is in a worse state than TOT in that respect having gotten all the way out to 47% as of the merger announcement (this factors in the 4% write-down they announced at the same time as the merger). Even if we cop a further 11 percent decline in the TOT portfolio the gearing will still only sit at 41 percent with an 85 percent NTA.

In terms of the NTA gap the situation at NPR pre merger was similar to what we are dealing with at TOT. The discount had blown out to an extraordinary 48% NTA discount pre merger whereas we are sitting at 40% (although as we've discussed it's still not a true NTA as it doesn't reflect further write downs).

Differences

I would class Bunnings warehouse freeholds as being a more in favour part of the market than office space which is well and truly in the doldrums and will remain so for the foreseeable future.

The directors of NPR held around 15 percent of the company between them and have all supported this deal whereas 360 holds 30 percent of TOT and I reckon that's the biggest factor that will stop us being absorbed into a bigger REIT as the current manager won't want to let the annual fees go.

Hopefully at the very least we can see sentiment improve at the very possibility that a shakeup might happen I just don't see it materialising unfortunately.