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Charter Hall Funds Acquire $140 million of Assets and the Group Underwrites a New Retail Syndicate

19/08/2015

Charter Hall Group (ASX:CHC) (Charter Hall or the Charter Hall Group) today announced a multi-asset transaction with Australia’s largest automotive retailer, the ASX listed Automotive Holdings Group (ASX:AHG).

Extending the Group’s focus on partnering with high quality tenants that enjoy strong market share within their sector, Charter Hall has acquired three high profile retail properties to seed a new $100 million retail syndicate. The syndicate has been underwritten by the Group and a Product Disclosure Statement will be registered for the retail equity raising.

The new syndicate, called Charter Hall Direct Automotive Trust (DAT) will, upon settlement on 30 September 2015, own three retail assets summarised below:

Property

Price

Gross Lettable Area

Lease Term

Castle Hill, NSW

$65.5 million

12,419sqm

12 Years

Kirrawee, NSW

$24.8 million

3,772sqm

15 Years

Brisbane, Qld

$12.0 million

2,715sqm

15 Years

The Kirrawee and Brisbane properties were acquired from AHG, and the Castle Hill property was acquired from an API managed syndicate established in 2012. 

In a further extension of the relationship with AHG, the Charter Hall managed wholesale industrial fund has acquired an industrial site from AHG at Prestons in Sydney for $13,755,000, subject to a 15 year pre-lease. The land is to be developed into the AHG East Coast head office and distribution facility  and, upon completion in mid-2016, has a forecast development cost of approximately $43 million. 

All AHG sale and leaseback properties have annual rent reviews of CPI +0.5% and lease terms reflective of modern single tenant assets. 

Once finalised, the DAT syndicate will increase the Charter Hall Direct business FUM to $1.9 billion benefitting from a weighted average lease expiry (WALE) of 9.5 years across its suite of long-leased portfolios,  said Richard Stacker, Head of Charter Hall’s Direct Property business.

Charter Hall’s Head of Wholesale Funds, Adrian Taylor said,  Upon completion of the Prestons development and recent acquisitions, CPIF will increase its portfolio to $1.25 billion with a WALE of 8 years, whilst the Group’s managed industrial platform now exceeds $3 billion.” 

AHG Managing Director Bronte Howson said, “The transaction is part of our normal capital management strategy to maintain capacity in our balance sheet to fund growth opportunities. It creates a partnership between AHG and Charter Hall, an institutional property manager which provides the scale and access to equity, and which allows us to look at future opportunities across our automotive dealership and logistics businesses.” 

Charter Hall’s Joint Managing Director, David Harrison said,  We are excited about forging a relationship with another high quality ASX listed group and hope that the AHG relationship will develop our mutual interests across the retail and industrial sectors. Charter Hall continues to drive momentum in its investment themes, including long WALE industrial and retail assets leased to quality tenant customers providing resilience and certain rental growth.

<View PDF version of ASX release >

For further information:

David Harrison 
Joint Managing Director 
T: +61 8651 9142
david.harrison@charterhall.com.au

 

David Southon
Joint Managing Director 
T: +61 8651 9143 
david.southon@charterhall.com.au

For investor enquiries: 

Nick Kelly 
Head of Investor Relations 
Charter Hall 
T: +61 8651 9235
nick.kelly@charterhall.com.au
For media enquiries: 

Rachel Mornington-West 
Head of Marketing and Communications 
Charter Hall 
T: +61 8651 9248 
rachel.mornington-west@charterhall.com.au