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    Mark Rothschild

    Research Analyst at Canaccord Genuity

    Mark Rothschild's questions to Brookfield Property Partners (BPYPP) leadership

    Mark Rothschild's questions to Brookfield Property Partners (BPYPP) leadership • Q3 2020

    Question

    Mark Rothschild of Canaccord Genuity asked about expectations for the balance sheet, leverage, and future asset sales over the next year. He also sought to reconcile the discussion about handing back mall keys to lenders with the scale of IFRS value write-downs on the company's books.

    Answer

    CEO Brian Kingston stated that future asset sales will likely come from the LP investments portfolio and stabilized office assets, with retail sales being more challenging. CFO Bryan Davis added that office leverage is comfortable, while the plan is to pay down about $2.5 billion in retail leverage over time. To reconcile the IFRS values, Kingston explained that for malls where handing back keys is considered, the IFRS value is already at or below the debt level, noting that over $1 billion in negative fair value adjustments had already been taken across the retail portfolio in recent quarters.

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    Mark Rothschild's questions to Brookfield Property Partners (BPYPP) leadership • Q2 2020

    Question

    Mark Rothschild of Canaccord Genuity questioned the company's confidence in refinancing over $4 billion of retail portfolio debt maturing by year-end 2021 and whether significant equity injections would be required. He also asked for clarification on the significant decrease in the balance sheet value of commercial developments in the office portfolio.

    Answer

    CFO Bryan Davis expressed confidence in refinancing the retail debt, stating most of it underlies high-performing malls and that they do not anticipate needing to contribute any material amount of new equity. He noted the current focus is on short-term extensions to wait for a more normalized market. Regarding the development value, Davis explained the decrease was due to the reclassification of two major completed projects, 1 Manhattan West and 100 Bishopsgate, from 'commercial developments' to 'commercial properties,' and not due to a write-down. He added that the remaining developments actually increased in value.

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    Mark Rothschild's questions to Brookfield Property Partners (BPYPP) leadership • Q1 2020

    Question

    Mark Rothschild from Canaccord asked about planned changes to capital allocation and CapEx budgets for the upcoming year. He also sought clarification on the company's confidence in executing asset sales across different property classes and requested a response to negative commentary on the New York office market.

    Answer

    CEO Brian Kingston stated that the primary capital allocation change is deferring the start of some retail redevelopment projects for reassessment. He expressed high confidence in future asset sales, particularly for high-quality office and multifamily properties, citing significant pent-up demand from institutional investors seeking yield. Kingston strongly disagreed with the negative outlook on the New York office market, arguing that while a recession poses challenges, the need for tenants to de-densify their spaces will create a significant counterweight, driving office demand.

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