This article is from the Australian Property Journal archive
THE Charter Hall Long WALE REIT (ASX: CLW) posted a statutory loss of $258.4 million for 1H24 after a $306 million portfolio devaluation.
CLW posted operated earnings of $94.0 million, or 13.0 cents per security, for the six-month period ending 31 December 2023.
CLW announced distributions of 13.0cps and net tangible assets of $5.14 per security.
The group’s portfolio has a weighted average lease expiry (WALE) of 10.8 years and a weighted average cap rate of 5.08%.
“CLW’s portfolio continues to demonstrate its resilience with strong income growth driven by 4.3% weighted average rent reviews across the portfolio,” said Avi Anger, fund manager at Charter Hall Long WALE REIT.
“The attractiveness of our assets has been demonstrated with the $145.8 million of completed or unconditional disposals achieved during the period. Further, we have in excess of $500 million of assets currently in due diligence to divest.”
CLW completed successful portfolio recycling with $85.1 million divestment of three industrial assets (Australia Post, Kingsgrove NSW, Coates Hire, Kingston QLD and Veolia, Campbellfield Vic).
As well as the $36.5 million office divestment of 40 Tank Street, Brisbane QLD, and the $23.0 million sale of a convenience retail centre anchored by Ampol at Redbank Plains, QLD.
This in addition to the $145.82 million in completed or unconditional disposals, CLW has in excess of $500 million of divestments in due diligence.
CLW’s portfolio had 53% triple net (NNN) leases, where the tenants are responsible for all outgoings, maintenance and capital expenditure.
With 52% of leases with inflation-linked annual reviews with a 5.4% weighted average increase in FY24 and 48% of leases with annual fixed reviews with an average fixed increase of 3.1%.
“We remain confident that CLW continues to be well placed to deliver strong rental growth, while the attractive nature of our assets provides opportunities to selectively curate the portfolio and build further balance sheet capacity.”
CLW had 94% of the portfolio by gross asset value independently valued as at 31 December 2023 with the balance of the portfolio having been independently valued at 30 June 2023.
The valuations resulted in a $306 million, or 4.5% net decrease from prior book values. The overall portfolio value decreased from $6,854 billion to $6,508 billion and the portfolio average cap rate expanded 31bps from 4.77% to 5.08%.
Over the period CLW refinanced and extended $320 million of balance sheet and look-through debt facilities.
CLW has a weighted average debt maturity of 4.7 years with staggered maturities over a six-year period from FY27 to FY32.
Look-through drawn debt is 82% hedged with a weighted average hedge maturity of 2.1 years. Balance sheet gearing is 34.5% and look-through gearing is 41.2%. CLW has $372 million of cash and undrawn debt.
CLW also reaffirmed FY24 operating EPS guidance of 26.0 cents and distribution per security guidance of 26.0 cents.
