7.5% Yield on block sale, acceptable return for taxpayer?

Reading this and the humungous yield in the era of quantitative easing and record low interest rates caught my eye. 7.5%!!!

irishexaminer.com/business/i … 32307.html
independent.ie/business/comm … 84948.html

Nice reporting there guys XX

CEO of this lot also predicts 10% rental yield growth within the year.
irishtimes.com/business/comm … -1.2227009

Was this a NAMA sale? What are they up to? I can’t tell what’s going on because the same report seems to be repeated almost verbatim across multiple Irish media sites, probably copied from a PR from the company itself!

It’s not NAMA.

So who is Tetrach Capital then? I’m interested in the back story. Why would they give away that juicy yield in an era of rising rental prices.

This is all I found from a British newspaper. :angry:
thesundaytimes.co.uk/sto/new … 559880.ece

irishtimes.com/business/comm … -1.2178613

Formerly know and Brehon Capital which begin life in 2011 with the purchase of the Marker Hotel and residences.

Well the title should be changed, but I don’t know how to do that. Still it’s curious to me why companies would off-load an asset generating such a large yield, could be exagerrated by the buyer or the seller needs the cash to put into other assets.
The deal of 4-6 million Euro for the social housing component earlier was pretty handy though, the government just keeps on giving.

That’s where the market is for this stuff.
And there’s no shenanigans in the price, the REIT is highly regulated.

Some investors look for yield and some for capital appreciation. These guys have probably made a profit on the capital appreciation and they have seen another place where they can invest the money from this sale that will make more money than leaving it where it is. If you can make 10% 3 times on the same chunk of money then you’ve actually made a 33% gain. Normally if an asset appreciates fairly quickly it will ‘stick’ for a while - if you can see another asset that you can invest in while the other one is stuck then you are keeping your money active. We saw this in the BofI share sales - the guys who sold out of BofI didn’t neccessarily see no upside on BofI but the share price has stuck over the last few months so they sensibly moved their money into other assets that were just about to start their run.

If you are going for yield you don’t care so much about about the underlying value of the asset as long as the yield on your original investment is maintained.

If recent history has taught me anything it is that Irish residential property is, well, risky!

Never.
The past 10 years was just a scratch !