Amidst Charter Hall Group’s (ASX: CHC) recent acquisition spree, CHC has announced a new managed partnership where CHC will acquire 49% interest in a Telstra Exchange portfolio, which comprises of 37 Telecommunication Exchange properties leased to Telstra Corporation Limited. The managed partnership will be 50% owned by Charter Hall Long WALE REIT (ASX: CLW), 28.2% by a wholesale capital partner and 21.8% by CHC.
The portfolio has a WALE of 21 years, with staggered lease expiries from 10 to 25 years, thereby extending the Group’s long WALE investment strategy. Additionally, the $1.43B sale and leaseback transaction was completed on a net passing yield of 4.4%, reflective of strong investor demand for long term defensive assets in a low bond yield environment.
As part of the acquisition, to fund its total acquisition cost of $350M, CLW, alongside debt, is seeking to raise $261M, $220M of which was successfully completed, and $41M expected to be raised through a retail entitlement offer which will open on 22 August 2019.
Reporting Season Week 2: Results released last week from GPT Group (ASX: GPT), Charter Hall Long WALE REIT (ASX: CLW), Arena REIT (ASX: ARF), Centuria Capital Group (ASX: CNI), Vicinity Centres (ASX: VCX), Dexus (ASX: DXS) and Charter Hall Retail REIT (ASX: CQR).