This article is from the Australian Property Journal archive
PROPERTY powerhouse Charter Hall has again lifted its full-year operating earnings guidance as it swelled to $79.5 billion in funds under management over the first half.
Giving that tally a major boost was the pre-Christmas acquisition of a 50% stake in Paradice Investment Management, which manages $18 billion worth of assets and expanded Charter Hall’s stable beyond real estate, as well as an additional $9 billion in property funds under management. It also netted a circa $3.5 billion valuation uplift across its platform.
Total funds under management soared by 52%, or $27.2 billion in the half. That helped boost management fees by 28.5% to $114.7 million, while transaction and performance fees skyrocketed by more than 550% to $177.2 million.
Operating earnings lifted 104.1% to $263.9 million, or 56.6c per security, and statutory profit jumped 199% to $517.8 million.
Charter Hall is now expecting full-year operating earnings to be no less than $1.12 per share, up from the $1.05 guidance given in December, and from the original guidance of more than $0.75.
“Charter Hall’s strategy of partnering with tenant and investor customers continues to deliver strong returns for securityholders. Investors continue to endorse our investments in long WALE strategies and look to benefit from our ability to access off-market opportunities,” Charter Hall’s managing director and group CEO, David Harrison said.
“During the period we also created a new partnership with a 50% investment in Paradice Investment Management. This partnership expands our funds management capability and allows us to service investor customers across multiple equity segments. We see good opportunities to grow the PIM partnership utilising our large retail investor community and our strong wholesale investor relationships.
“With investment capacity of $6.7 billion across the platform, continued strong demand from capital partners to deploy equity, a growing development pipeline and significant retained earnings, we continue to see a strong pathway of growth for the group.”
During the half Charter Hall teamed up with industry fund Hostplus to acquire Australia’s largest ASX-listed hotels landlord, ALE Property Group in a $1.68 billion deal, while together with Dutch pension giant PGGM, it is closing in on a $1.3 billion takeover of Irongate, with the ASX- and Johannesburg-listed company having granted due diligence with intentions of recommending the bid.
In a six-month record for the group, it deployed $5.4 billion in acquisitions across 18 funds and partnerships. Property investment returns grew 18.5% to $71.6 million.
Charter Hall has been a major player in the huge rush towards industrial and logistics assets since the beginning of the pandemic, most recently buying South Australian government-leased facilities in Adelaide for over $100 million and the Toyo Tyres facility in Sydney’s Minto.
It has also bought major office assets in Canberra and in Newcastle.
Charter Hall has a $13.2 billion development pipeline, including the $2 billion Chifley South development at 2 Chifley Square in Sydney, where it has secured global investment bank UBS as an anchor tenant.
Charter Hall declared distributions of 19.7c per security.
