This article is from the Australian Property Journal archive
THE Charter Hall Social Infrastructure REIT (ASX: CQE) has posted a statutory loss of $19.6 million for FY24, a sharp turnaround from last year’s $58.7 million profit, as the group continues to divest childcare assets.
CQE did post operating earnings of $59.6 million or 16.0 cents per unit and distributions of 16.0 cents per unit.
CQE’s net tangible assets were at $3.82 per unit.
In the first half, CQE saw rental growth across its $2.2 billion childcare and medical real estate portfolio, resulting in a 10.9% increase in net property income over the first half.
The REIT’s $2.2 billion property portfolio has a yield of 5.2%, with an occupancy of 99.8% and a WALE of 12.4-years.
100% of the portfolio was independently valued at a passing yield of 5.2%, resulting in a 2.2% or a $48.5 million decline on like-for-like June 2023 book values.
The portfolio’s weighted average rent reviews were at 3.4% for the 12 months to June 2024, with 67% of lease income of fixed rent reviews and the balance CPI-linked and market.
48% of rental income is subject to market rent reviews in the next five years, with 2.4% of lease income expiring in the next five years.
“The quality of the portfolio was demonstrated through the divestment of 12 childcare assets at a premium of 4.1% to previous book value. The fund will continue to invest in properties that deliver essential community services,” said Travis Butcher, fund manager of CQE.
The childcare asset divestments totalled $40.0 million at a yield of 4.7%, with a further three childcare centres divested at $27.9 million at a yield of 4.5% since 30 June 2024.
CQE successfully refinanced its debt facilities in January to a new unsecured platform, resulting in weighted average debt maturity increasing from 2.9-years to 3.9-years.
CQE has average hedging of 81% through to June 2025 at an average hedged rate of 3.1%.
While balance sheet gearing is at 33.0% and within the target 30% – 40% range, with look-through gearing at 33.7%.
CQE has posted a FY25 distribution guidance of 15.0 cents per unit.
