reply from is, page-36

I agree Hope

I think NTA is rubbish at times.

If more emphasis is placed on ICR covenants over LVR, and the company is clear of going concern issues, then I believe DCF should be used to value th ecompany and not NTA. Is CER's case, all US properties are subject to ICR and Aust properties are both ICR and LVR. As Kylie hinted to me the other day, there is perhaps more emphasis on ICR at this point in time.

CER's future is stabilised so why are even concerned if Jo Blow the valuer decides to lower the value of CER's properties even though it has nil cashflow impact.

I am more concerned about the rental income that is being generated vs the cost of the debt, not the SIZE of the debt but the COST of the debt

Not only are lower interest rates increasing the ICR because of lower interest rates and increased spending by consumers but as you said Hope, this should be increasing the value of the properties as lower interest rates make commercial property a much more attractive investment.

Why would you invest in a term deposit at 3% now if you can earn a yield of 6.85% (current CER Aust yield) by buying out an Australian property at its current valuation?

Rental income is still increasing and should continue to do so thanks to low interest rates, occupany at 100% and the second stimulus package about to kick in.

The spread between the cash rate and the cap rates on commercial properties is too great.

Cheers