This article is from the Australian Property Journal archive
THE Centuria Industrial REIT (ASX: CIP) secured 45,739sqm of deals across eight transactions over Q3 FY24, benefitting from the strength of the urban infill industrial market.
The eight transactions reflected 3% of portfolio GLA and contributed to 154,595 sqm of lease terms agreed to in the year-to-date, reflecting 11% of GLA.
CIP’s average re-leasing spreads year-to-date held steady and achieved c.50% increases.
CIP’s portfolio provided a 7.3-year WALE and 97.2% occupancy, as at 31 March 2024.
“CIP continued to benefit from strong sector tailwinds within urban infill industrial markets. CIP’s strategic exposure to land-constrained ‘last mile’ locations continued to achieve robust rental growth, and has generated strong re-leasing spreads,” said Grant Nichols, fund manager at CIP.
“We believe the continued adoption of ecommerce and onshoring supply chains will maintain demand for infill industrial markets.”
Additionally, over the quarter CIP made an $11.5 strategic acquisition in 11 Hexham Place, Wetherill Park NSW to add to its Wetherill Park sub-portfolio to five assets across 5.7-hectares.
CIP also made a $21.6 million divestment over the period, exchanging contracts to sell its non-core asset at 51-73 Lambeck Drive, Tullamarine VIC.
The sale was in line with the asset’s December 2023 book value and settlement is expected by the first quarter of FY25.
CIP acquired the asset for $14 million in August 2020, with the divestment delivered a 17% IRR throughout the ownership period.
Centuria also announced the promotion of Grant Nichols to head of listed funds and CIP fund manager.
This followed the promotion of former CIP fund manager, Jesse Curtis, Centuria’s head of funds management.
CIP has reaffirmed its upgraded FY24 FFO guidance of 17.2 cents per unit and a distribution guidance also reaffirmed at 16.0c ents per unit, expected to be paid in equal quarterly instalments.
“CIP remains the only domestically focused, pure play industrial REIT listed on the ASX, providing investors with a portfolio of high-quality real estate assets across Australia’s major urban infill industrial markets,” added Nichols.
“Looking ahead, we believe CIP is well positioned to benefit from the industrial sector tailwinds, underpinned by Australia’s burgeoning population, which is forecast to increase by more than 975,000 people between 2023 and 2025. This population expansion alone is expected to increase Australian industrial demand by c.4.5million sqm.”
