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$192m increase in Centuria Industrial REIT’s Portfolio within Q3 FY21

  • 8.1% portfolio value increase on a like for like basis, during Q3 FY211
  • 46bps increase in total portfolio WACR to 4.96%2
  • Proforma NTA increased to $3.32 per unit3
  • Total portfolio value increased to $2.6bn4.

Australia’s largest listed pure-play industrial fund, Centuria Industrial REIT (ASX: CIP), today announced its total portfolio value increased within the March quarter by $192 million1 to $2.6 billion4 on a like for like book value basis.

Of its 61 industrial assets, 56 were independently valued5 resulting in healthy increases in capital values and overall capitalisation rate compression across the portfolio, which is evident from recent market transactions.

During FY21 to date, CIP transacted $757 million worth of industrial assets, which alone generated a $64 million uplift towards its total portfolio revaluation gain.

The weighted average capitalisation rate (WACR) tightened 46 basis points from 5.42% to 4.96%2.

Subsequently, proforma Net Tangible Assets (NTA) increased from $2.99 to $3.32 per unit3.

Jesse Curtis, CIP Fund Manager, commented, “Currently, Australia’s industrial property market is experiencing a substantial re-rate, attracting significant investment demand from both domestic and international capital.

“Major transactions in the market continue to show capitalisation compression, complemented by strong tenant demand from e-commerce and a scarcity of investment grade assets.”

Key valuation movements include:

Property Location Revaluation Increase Capitalisation Rate Compression  Industrial submarket
Telstra Data Centre Clayton VIC $28.3m 50.0 bps Data Centres
46 Robinson Road East Virginia QLD $20.0m 37.5 bps Manufacturing
67-69 Mandoon Road Girraween NSW $11.8m 75.0 bps Cold Storage
75 Owen Street Glendenning NSW $3.4m 75.0 bps Distribution Centre

The CIP portfolio has a healthy 9.8 year Weighted Average Lease Expiry (WALE) and a 97.7% occupancy6.

Curtis concluded, “With evidence of continued major transactions in the industrial sector expected, CIP’s is well positioned to be a major beneficiary of the strong performing Australian industrial market.”

 

  1. Reflects gross increase. Excludes capital expenditure incurred.
  2. Pro forma WACR as at 31 December 2020, including transactions settled in Q3FY21.
  3. NTA per unit is calculated as net assets less goodwill divided by number of units on issue
  4. Following revaluations and transactions settled in Q3FY21
  5. Assets not externally revalued are 2 Woolworths Way, Warnervale NSW which is under a sales campaign, 2-8 Lexington Drive, Bella Vista NSW which was acquired in March 2021 and 42 Hoepner Road, Bundamba QLD which is under development. Valuations on two further assets, 324-332 Frankston Dandenong Road, Dandenong VIC and 92 Robinson Avenue Belmont WA are being finalised and will be reported in the Q3 FY21 Fund Update
  6. By income. As at 31 December 2020.