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  • Gramercy Property Trust: Asymmetric Risk/Reward In This 8.125% Coupon Preferred [View article]
    Thanks All for the comments.

    gymbo,
    Clever strategy on the income tax arb. I had put any considerations around tax treatment in the 'Too Hard' category, this is held in my tax advantaged accounts.

    While I believe these shares deserve a premium given the simplicity and transparency of GPT's portfolio, I wouldn't expect a significant premium and realistically I would probably be a seller anywhere above $26 post accrued payoff due to the possibility of the company either (a) issuing either common or preferred with a lower yield or (b) being acquired by a larger REIT who would be able to easily refinance this issue.

    Whether the shares trade at par or a small premium post pay-off, to me the most interesting part of the idea is the 'special situation' aspect that comes into play with the upcoming catalyst and potential large annualized return possible with a modest $1-2 in capital appreciation. My original entry point was a $1.37 (4%) discount which will probably disappear in the next 30-45 days.

    Either way I'll be happy to hold these shares backed by a very easy to understand business paying the 8.125% coupon.
    Dec 11 12:35 AM | 1 Like Like |Link to Comment
  • Gramercy Property Trust: Asymmetric Risk/Reward In This 8.125% Coupon Preferred [View article]
    The company's CFO (Jon Clark) did mention on the last earnings call that part of the upcoming dividend payment might be qualified due to taxes paid by the Taxable REIT Subsidiary, but otherwise REIT dividends are generally not qualified.
    Dec 11 12:35 AM | 1 Like Like |Link to Comment
  • Gramercy Property Trust: Management Continues To Execute [View article]
    Yes, I see that in their presentation now.

    I've been long GKK/GPT since the beginning of the year, seems like a good level to add to the position around $4 after all the progress they've made.
    Aug 20 02:11 PM | 1 Like Like |Link to Comment
  • Gramercy Property Trust: Management Continues To Execute [View article]
    Thanks Steven, nice update on GPT. It would be interesting to see the 34mm of accrued preferred dividends accounted for in your analysis, maybe as a reduction to the additional investment capacity? The 88mm par amount is clearly accounted for in the AFFO calculation (88mm x 8.125% pref div for 7.2mm expense), to get to a normalized AFFO as you're doing in Scenario 2 I think we need to bring the preferreds current by paying off the accrued and reducing additional investment capacity if that hasn't already been done.
    Aug 20 02:30 AM | Likes Like |Link to Comment
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