Charter Hall's $353m Bunnings deal tops out $3b spending spree
A Charter Hall managed fund will add six Bunnings warehouses to its hardware-focused portfolio after a $353 million deal with vendor real estate manager CBRE Global Investors.
Charter Hall’s Long WALE Hardware Partnership – which manages investments for Victorian Funds Management Corporation, Telstra Super and Charter Hall Group – has acquired the Bunnings sites on a 4.63 per cent yield, the bulk of them in Sydney, Melbourne and Brisbane.
The sheds – in Bonnyrigg, Caringbah, Windsor Gardens, West Footscray, Underwood and Virginia – have a weighted average lease expiry of 10 years and 2.5 per cent annual rent reviews.
CBRE Global Investors owned the warehouses for about four years. Another shed in New Zealand, also part of CBRE Global’s Pacific portfolio, is likely to be included as part of the deal.
Charter Hall managing director David Harrison said the group’s platform now has about $2.4 billion invested in 59 Bunnings stores, 50 of which are in metropolitan locations.
“This transaction represents our seventh Bunnings portfolio acquired since 2006,” he said.
JLL’s head of retail Sam Hatcher, who negotiated the transaction with Nick Willis and Jacob Swan, said it was the largest retail transaction so far this year.
“Assets that provide income certainty, by way of covenant and lease term, are attracting an enormous weight of capital and we expect this to continue,” Mr Hatcher said.
Charter Hall and its related entities are one of the market’s most active players, buying $3 billion in assets and selling $377 million since July 1 this year.
Last week, the group’s Social Infrastructure REIT splashed out $80 million on South Australia’s new Emergency Services Command Centre.
Other major deals this year include splashing $648 million on Aldi’s logistics facilities in Sydney, Melbourne and Brisbane and $215 million on industrial properties in Melbourne’s west, purchased from Owens-Illinois Australia which sold its business to Richard Pratt’s Visy.
