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- 28 October 2008
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Where have I questioned the viability of Westfield ?
There is a reference to Westfield in the article. As you have now read it you would be aware of that.
Where have I questioned the viability of Westfield ?Yes, Thats right Pointless speculation in response to pointless speculation,
I am saying the fact that this is happening in the sector will not have any affect on westfield's viability in the shorterm or longterm,
There is a reference to Westfield in the article. As you have now read it you would be aware of that.I can't comment on other members of the sector because I know nothing about them, except I do know stocklands assets and balance sheet don't match WDC in terms of qualty, so it may be a problem for them if they are already over leveraged and have weaker properties with weaker tenants.
The original article was talking about stockland not WDC.
There is a reference to Westfield in the article. As you have now read it you would be aware of that.
The fact it is being done is material. As to whether Quinn's comment about WDC is throw away you can't be sure of that. The retail environment environment in the USA is currently far tougher than that of Australia.It's means nothing, It's just a media beat up for a story. Even the stockland guy says the amounts they have loaned are immaterial amounts, and then he just throws WDC's name out there in a throw any comment.
Reasonable comments.Thats a big potential 'IF' the small business fails. I'm sure westfield, or stockland, or whomever the larger company is, they do their due dilegence on the company beforehand to make sure they will be profitable enough to not only pay their rent but also pay their loan owing to their larger company.
Yes if the small business defaults then the large company takes on the debt and risk and loses their money. But it also can provide the returns on any idle cash they may have had as well.
Its basically an investment that westfield or scotland are making in the small business to make sure that their core business of having their land rented continues to occur as well. This may have been a major issue 6-12 months ago when unemployment was on the major rise and consumers were spending less at the stores. But as unemployment is now reasonably steady / on the improve the only main thing that I can see hurting the small business within the malls is when the stimulus is wound back. However even in aus to the individual it has been wound back, its only the infrastructure stimulus that is really left to be implemented.
So in essence, yes it is more risk for the property companies, but i'm sure it is calculated risks that they would only take on if they are comfortable and see it as a positive for shareholders. All companies are going to have risk, you just have to be comfortable that management understand the risk they are taking on, which I would be confident Westfield would handle any loans dilligently.
Agree. That's the point of a forum. Any discussion which forces us to consider our decisions in light of a different view is not wasted.It wouldn't be much of a forum if we all agreed on everything.
The fact it is being done is material. As to whether Quinn's comment about WDC is throw away you can't be sure of that. The retail environment environment in the USA is currently far tougher than that of Australia.
Where have I questioned the viability of Westfield ?
How you wish to assess the risk is up to you but that does not jusitfy unrelated comments such as this.I didn't say that you questioned the viability of WDC, other than hinting there is risk associated because of the factors we have been discussing. My comment was just saying that I don't believe any associated risk is of a scale that would have a large enough impact as to have a noticable affect on profitabilty or the viabilty of the company or my investment decision.
You only make a fool out of yourself with that sort of commentary.In fact you and dr smith both made negative comments ( on different threads) in regards to my investment in Beppa. Luckily I didn't listen to you both because within weeks my 300,000 shares went from 8c to 37c.
It does increase overall sector risk and that is something any potential investor needs to be aware of.
You only make a fool out of yourself with that sort of commentary.
I don't intend to buy into the bigger "discussion" that seems to be going on here but on the subject of risk to WDC in supporting/lending to its tenants, yes, it is a risk but it's a business risk which WDC management is well qualified to assess and assume if appropriate.
As has been stated, risks are present with all businesses. It's the ability to assess and manage those risks that sorts out the successful companies from the unsuccessful.
Or is that too obvious?
Not sure that WDC is well qualified - it is in the retail space leasing business not lending business. Personally, I hope that they are not extending too much credit to tenants.
I hold
Can you explain your definition of "working out"?WDC had a good run today, my newb prediction says it will pass $13 by next week. I've been holding WDC since april last year, and it's been working out so far.
Can you explain your definition of "working out"?
It's less than $3 more now than it was in April last year.
Can you explain your definition of "working out"?
It's less than $3 more now than it was in April last year.
Agree. Plenty of much more profitable stocks than WDC.Top down the growth in retail sales in the western economies in which Westfield operates has been financed a lot by increased consumer debt.
Unless they expand into emerging economies (China and India for example), their growth will be limited. The Lowy's have up to this point been cautious with their expansion into new markets and this to some extent saved Westfield from the slaughter of other listed property unit prices during the GFC.
Their real long term capital growth rate is therefore likely to be limited at best.
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