'Bunnings Trust': Investors back extension of trust - 17.9% pa return to date

A meeting of unitholders in the Charter Hall Direct BW Trust, an unlisted property trust which holds four retail warehouse buildings in NSW and Victoria 100% leased to Bunnings as retail stores, voted overwhelmingly to extend the life of the trust by five years.

The head of Charter Hall Direct, Steven Bennett, said the vote to extend the life of the trust was a strong vote of confidence in both the quality of the assets and the management of the trust given the recent new 10 year leases negotiated with Bunnings.

“As a fund manager we recognise the importance of working hard to generate superior returns for our investors. Through active management and utilising Charter Hall Group’s strong long term relationship with Bunnings to extend the lease terms to 10 years remaining, we have provided confidence to investors that we can build on the 17.9% IRR achieved since inception of the trust.”

The four properties in the trust comprise Bunnings Warehouse Armidale, NSW; Bunnings Warehouse Rouse Hill, Sydney; Bunnings Warehouse Taree, NSW; and Bunnings Warehouse Rosebud Victoria with all four properties secured by new 10-year leases to Bunnings Warehouse.

“We continue to see demand from investors who are seeking quality managers to look after their savings and retirement income. The strong performance of the trust since its inception and the positive sentiment of investors towards investing in high grade commercial real estate underpinned by long leases to strong tenant covenants means that demand for commercial proeprty investment opportunities is still strong.”

Investors who elect to exit the trust have the opportunity to do so in a timely and efficient manner under a liquidity facility, implemented following the approval of the extension.

The forecast distributions are 9.70 cents per unit per annum paid quarterly.¹

_{^1. The forecast period is the 12-month period ending 31 March 2019 (includes actual data for the period from 1 April 2018 to 31 January 2019 and forecast data for the period from 1 February to 31 March 2019) and the 12-month period ending 31 March 2020.}