Whenever I see a proposal from Brookfield to acquire something I...

Whenever I see a proposal from Brookfield to acquire something I own, I instinctively reach for my wallet, because I can be certain that they are trying to pick my pocket.

After enduring several years of below average returns from Brookfield Prime Property (cash retained supposedly to fund capital improvments and lease incentives), the sales of the Southern Cross properties in Melbourne triggered a huge turnaround in the fortunes of investors with a big one-off distribution and a step-up in quarterly distributions.

With a new 10 year lease signed with American Express and significant progress in releasing space vacated by E&Y, the future was looking very bright indeed. So what's not to like about an offer to acquire your units for a 15-20% premium to the 30 day WAP?

1. The offer is below current NTA, now $9.02 following the Amex lease agreement.

2. NTA is almost certainly understated. The sales of the Southern Cross properties end 2015 were at a premium of 26-41% to the most recent valuations - why would anyone trust the valuations of the remaining properties? We know for a fact that the valuation of the Perth property has been discounted to reflect the modest 78% occupancy rate - it states as much in the 2017 half year review.

3. Brookfield is a serial offender when it comes to acquiring assets on the cheap. That's fine when you are investing alongside them, but not so great when you are on the other end of the transaction (think Prime Infrastructure Holdings and Terraform Global to name just a couple in which I have had a personal interest). If you think you are getting value in Brookfield offering you $8.89/unit, then you are almost certainly missing something.

Looking forward with interest to reading the work of fiction commonly referred to as the 'independent expert's report'.