This article is from the Australian Property Journal archive
AFTER a period of significant acquisition activity Charter Hall Social Infrastructure REIT (ASX: CQE) has announced a statutory profit of $207.7 million, an increase of $150.4 million on the prior corresponding period.
For the half year ending 31 December 2021, CQE posted operating earnings of $30.8 million, up 5.8% on the pcp, or 8.5 cpu, up 6.3% on the pcp.
The REIT posted a distribution of 8.4 cpu, up 12.0% on the pcp. With gross assets at $1.9 billion, a 28.2% increase since June 2021 and an NTA of $3.78 per unit, up 16.3% from June 2021.
“CQE has continued delivering on its strategy of improving the portfolio quality and metrics to enhance income and capital growth for unitholders,” said Travis Butcher, fund manager of CQE.
In its property portfolio, there was a valuation increase of $175.4 million, for a 11.9% increase net of capital expenditure and a passing yield of 4.9%. While CQE deployed $192.7 million on new acquisitions.
This total value was spread across 24 newly acquired assets, at an average yield of 4.5%, with an average WALE of 13.4 years.
“Continued portfolio curation and capital management ensure CQE is well positioned to maintain security of earnings and capitalise on future growth opportunities,” added Butcher.
With an emphasis on acquiring high-quality, well-leased social infrastructure assets, predominately across the childcare, government and healthcare sectors, the CQE portfolio was at the end of the period at 100% occupancy, with a WALE of 14.6-years.
Additionally, 75% of leases in the portfolio were on fixed rent reviews, for a forecast WARR of 3.0%, with lease expiries in the next 5 years representing just 3.9% of portfolio income.
CQE divested two childcare centres over the period for $8.8 million, a 37.0% premium to book value.
CQE’s balance sheet gearing was at 30.0%, with look through gearing at 30.8%, while the REIT reported an investment capacity of $200 million.
The REIT increased its debt facilities in February 2022 by $100 million, for a total facility of $800 million, leaving weighted average debt maturity at 4.2 years.
CQE reaffirmed its distribution guidance for FY22 of 17.2 cpu, up 9.6% on FY21, barring any material changes with COVID-19 or unforeseen events.
