# Any thoughts on Northwest Healthcare (NWH.UN.TO)?



## favelle75 (Feb 6, 2013)

Its a medical REIT, been following it for about 6 weeks. Bought a small position today at $11.05. Just interested to see if anyone else has been following it?


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## HaroldCrump (Jun 10, 2009)

I have a small position in it, bought at $11.20 I think several months ago.
When you research it, please look carefully into its relationship with Northwest International Health Care REIT - MOB.UN.
As part of your research, you have to look at the impact on NWH's books earlier this year when MOB.UN transferred its entire portfolio to NWH.


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## Echo (Apr 1, 2011)

I see really big things in North West's future - http://www.thestar.com/entertainmen...nye_reportedly_name_baby_girl_north_west.html


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## andrewf (Mar 1, 2010)

I was wondering how long that would take .


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## gibor365 (Apr 1, 2011)

I like NWH.UN model...aging population and so on...
I check chart of NWH.UN vs CUF.UN and ZRE... they are very similar... Is Medical REITs "behaviour" somehow different from other REITs?


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## Andrew (May 22, 2009)

gibor said:


> I like NWH.UN model...aging population and so on...
> I check chart of NWH.UN vs CUF.UN and ZRE... they are very similar... Is Medical REITs "behaviour" somehow different from other REITs?


My initial thought is doctors and medical labs are less risky tenants.


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## gibor365 (Apr 1, 2011)

Andrew said:


> My initial thought is doctors and medical labs are less risky tenants.


Why? Do you think that , for example, WMT or MCD or TGT are more risky tenants?!


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## the-royal-mail (Dec 11, 2009)

Currently trading at nearly 52 week low of $10.03 in case anyone is interested in buying.

CUF.UN hasn't been doing that well lately either.


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## Eclectic12 (Oct 20, 2010)

gibor said:


> Why?
> Do you think that , for example, WMT or MCD or TGT are more risky tenants?!


Hmmm ... if one is sick, will one skip the doctor/medical lab or skip a big Mac or shopping trip?


Then too, most at work I've talked to have been underwhelmed with the TGT "bargains" so it's not looking like a 
"open your doors, they will come" success story.


Cheers


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## trophy_23 (Jan 31, 2014)

Been watching it for a while. I picked some up a while back around 10.30.


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## Killer Z (Oct 25, 2013)

Closed at $9.58, and currently pressed up against it's 52 week low ($9.55), which happens to also be it's lowest point since inception.


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## Homerhomer (Oct 18, 2010)

Eclectic12 said:


> Hmmm ... if one is sick, will one skip the doctor/medical lab or skip a big Mac or shopping trip?


I think it goes different way, people eat big mac and then get sick...... that's why I own both ;-)

However I don't think MCD and TGT is a fair comparison as far as quality of tenants is concerned, it should rather be compared to corner stores, small offices, fish and chips fast foods and so on, and the quality of medical tenants in comparison to those is much higher and much more stable. In addition medical actually may be more stable than large retail, if you loose one dr you probably still have 49 others in the building and only need to worry about 2%, you loose target and that may be 50% loss of the revenue from one location,


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## 2tire2work (Jul 20, 2013)

Bought some at 9.60 yesterday


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## Andrew (May 22, 2009)

I own quite a bit of NWH. I was reading their latest annual information form on Sedar and this paragraph has me concerned. 



> *Non-Competition Agreement *
> Pursuant to the Non-Competition Agreement, and subject to the exceptions set out below, Paul Dalla Lana, NW
> Trust and/or any of its affiliates will not, during the period that is the longer of: (i) the period during which such
> person owns, directly or indirectly, 10% or more of the securities of the REIT, calculated on a fully diluted basis;
> ...


Translation - I am concerned that the founder who sold a large part of his stake in the company at the IPO (now only has a ~25% stake) now may be selling the rest of his position or directing his talents elsewhere.


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## HaroldCrump (Jun 10, 2009)

What do you mean _now only has a ~25% stake_?
He's had ~ 25% stake for a long time now, via NW Trust
Go as far back as 2012 and NW Trust's stake varies around 23%, give or take.


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## Andrew (May 22, 2009)

HaroldCrump said:


> What do you mean _now only has a ~25% stake_?
> He's had ~ 25% stake for a long time now, via NW Trust
> Go as far back as 2012 and NW Trust's stake varies around 23%, give or take.


~25% stake post IPO. I am concerned that the recent drop in price of NWH may be because he has started to sell off that 25% stake.


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## HaroldCrump (Jun 10, 2009)

You could be right.
Keep an eye out for insider selling reports.

Their last quarter results were not good, so that could be another reason for the sell off.
No improvement in NOI, only marginal reduction in AFFO payout ratio, occupancy not increased, high debt, etc.

If your theory is correct, that means Paul Dalla Lana is shifting his priorities to NWH International.
You can hedge your NWH position by taking a long position in MOB as well.
I did just that, a while ago.

When NWVP announced the RTO of GT Canada, I had an inkling that he is going to do just that (i.e. transfer properties between the two companies).
You can see that whatever NWH has lost in value, MOB has gained, and then some.

These are both niche, low volume, and highly sectorial stocks, so extra caution is required.


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## favelle75 (Feb 6, 2013)

Good find Andrew. I own a few NWH.UN shares... Been watching then tank lately, wondering what was going on.


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## Andrew (May 22, 2009)

HaroldCrump said:


> You could be right.
> Keep an eye out for insider selling reports.
> 
> Their last quarter results were not good, so that could be another reason for the sell off.
> ...


Good point on the MOB hedge. I may do just that.


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## Eder (Feb 16, 2011)

I sold mine today for a loss...I found a couple better opportunities for the funds and still H&R, Rio Can and have recently added to my First Capital Realty holdings.


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## favelle75 (Feb 6, 2013)

Eder said:


> I sold mine today for a loss...I found a couple better opportunities for the funds and still H&R, Rio Can and have recently added to my First Capital Realty holdings.


I was going to sell as well....hoping for $10 and then maybe I'll cut out. Then again, its a very small position for me (1.5-2%) so maybe with the large divvy, I just let it ride?


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## TomB19 (Sep 24, 2015)

Interesting times. 1Q17 earning call on May 16.

I expect NWH to outperform analyst expectations but time will tell. Does anyone have some insight into this REIT?


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## TomB19 (Sep 24, 2015)

Earnings call today at 5pm EST, for those interested.

http://phx.corporate-ir.net/phoenix.zhtml?c=235532&p=irol-irhome


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## TomB16 (Jun 8, 2014)

I have owned this REIT since 2010 and it has taken good care of us. There was a brief time when NWH was our largest position, when Dream Global was bought out. Now it is our third largest. I stopped adding to this position around the time they started buying everything that isn't bolted down in Australia and New Zealand but have never sold a share.

Once a company starts focusing on being big, instead of performance, I feel it has lost it's way. This is what I believe has happened to NWH. So, I will continue to hold and enjoy a decent distribution but have extreme low expectations for the future. They seem to be diluting their issue as quickly as they add equity.

I was hopeful they could digest the Australian acquisitions and bump the dividend but the answer to that is now clear.


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## londoncalling (Sep 17, 2011)

If the stock no longer suits you why continue to hold? Is it due to cap gains in non reg? Or is there nothing out there that you think will give a return? With the recent decline in the markets now would seem like a good time to switch into something better.


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## TomB16 (Jun 8, 2014)

I'm not a trader. When I buy a company, I consider it a partnership.

Most of our NWH position was acquired in 2011~2012 when I was growing it as aggressively as possible. Our average price is below $10, so it's been a while.

NWH will be the first position sold as we roll into retirement but I have no interest in buying/selling anything based on anticipated performance. If they were to goose the dividend a bit, I would probably hang tight with them but it hasn't changed in many years and it doesn't look like it is going to.


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## londoncalling (Sep 17, 2011)

As you know, REITs are reluctant to raise dividends because of their high payout ratios. However, after many years of no increases one is not getting much return after inflation. It's ok to have a few of these bond like stocks in the portfolio however, it could mean trouble down the road due to dilution, and increased debt coverage costs. If you held it for a decade you are very familiar with the company and if it was a good hold at $7 or $8 it is definitely a good sell at $12. Your response tells me you do have a plan to exit and the rationale for it. Sometimes partnerships end but if you have no place to deploy the funds it may make sense to stay the course until you need the cash. What happens between now and then is anybody's guess.


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## zinfit (Mar 21, 2021)

I recently sold it. I only own one Reit and that is Dream Industrial. With the rising interest rate scenario I believe most will be challenged . A higher cost for capital and a downward pressure on their NAV.


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## TomB16 (Jun 8, 2014)

It's frustrating to watch a company try to get big with no regard to corporate performance. This seems to be an extremely common operating vector. The only explanation I can think of is the executive suite is hungry for power and wants their domain to be as large as possible.

Unfortunately, we still have a little bit of NWH-UN.

I had long term sell orders in place and they mostly filled but we still have 12% of the shares we had at the start of the year. When the price fell below $13, I decided to sit on the stock. In retrospect, I'm not sure that was a great idea.

Paul Dalla Lana is mildly toxic but I've seen worse CEOs. If he were replaced, it is not certain things would go better.

I have a tiny bit of healthcare related R-E management and this causes me to believe NWH-UN is being operated very inefficiently. It's a global REIT so I don't proclaim to understand the scope of their operation. If I thought I had a better understanding, I might kick our remaining tranche to the curb.


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