yet another new aja poster with a view..., page-15

Morley, welcome to the Aja forum. It's great to have different opponions in the forum.

Bvw and Coppertop have addressed most of your questions and concerns.

I just have one thing to add: AJA's interest cover is still at 3.5 times, down from 3.7 times last year. Given that the interest costs won't change much, it will take a huge cut in the income (>50%) to theaten aja's existance. I actually expect aja's income will increase from first half. Aja was hit hard last year, and had a whole building empty. I think the management is doing a decent job, and filling the empty building. Aja's ability to re-finance Its asset debt in the past 12 months is another proof.

With no corporate debt, non recourse asset debt, no LVR covenance and enough room for interest cover, I think the threat to its existance is minimal. Of course there are still many risks, eg. Deflation, commercial RE market continues to slump, or even Earthquake or another Korean war. But I think the reward is also substantial. I am also a long term investor. To me, if Aja is not in danger, I am happy to sit back and wait for the jREIT market returns around, and collect my dividend while waiting. If the dividend is cut due to worse market conditions, so be it.

A couple other indirect factors: 1) Aja didn't have a cap raise during the GFC, management is very expirienced and knows Aja business very well. If there were a need, they would have raised capital already. 2) institutions started buying Aja again, especially the small insto's, they always do their homework.

Cheers and DYOR.

Snowfree