Core Property reviews government and social infrastructure fund by MPG Funds

Core Property has reviewed the Regional Cities Property Fund by MPG Funds Management.

The Fund provides an investment in a portfolio of properties based around government and social infrastructure tenants in regional cities on the eastern seaboard.

The investment metrics include:

  • 13 fully occupied assets valued at $100.8M,
  • 88% of income is secured against government tenancies, including the Commonwealth Government and the State Governments of QLD, Victoria and NSW.
  • Contracted rental increases of ~3.0% p.a, with a portfolio weighted average lease expiry of 5.1 years.
  • A distribution yield of 7.05% p.a. to 30 June 2020, increasing to 7.15% p.a in FY21.

Core Property has rated the Fund as RECOMMENDED, however notes that macroeconomic uncertainty as a result of COVID-19 may pose a risk to future valuations and capital returns.