We would consider it a decent update; the Trust is indeed making progress and the asset sales and liquidity have improved things. That being said, the equity value is likely quite overstated. The Toronto assets will likely see a writedown. Investors remain cautious, and the stock is down 42% YTD. Its small size adds risk, and a Bloomberg all-in default ratio is nearly 7%, which is very high. Principal repayments for 2024 are 'probably' OK, but there remains significant maturities over the next three years. Essentially, we would consider units a high-risk bet on the real estate markets in Ottawa and Toronto. While there is recovery potential under the right conditions, its small size, risk and lack of distribution may continue to keep investors away, so units might still lag. It is hard for us to endorse it still.
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