Charter Hall Retail REIT(CQR) has agreed to acquire a 49% interest in a portfolio of 51 Long WALE convenience retail properties leased to Ampol-owned Z Energy.
The remaining 51% interest will be retained by Z Energy.
CQR said this new partnership represents an extension of its existing relationship with Ampol and follows Ampol’s acquisition of the Z Energy business in New Zealand.
CQR’s 49% interest has been acquired for AUD $120 million (NZ$132 million) on a 5.50% cap rate with annual NZ CPI rent escalations (2% floor, 5% cap), triple net leases (NNN) and a 15.3-year WALE. 78% of the portfolio’s 51 assets are located in metropolitan areas.
The transaction is expected to settle at the end of October 2022.
Further, CQR has divested its 52% interest in the Coles Distribution Centre, Adelaide (CDC) at book value to a Charter Hall managed fund. The $95.3 million proceeds are net of asset level debt and will be used to fund the acquisition of the Z Energy portfolio.
The transaction is expected to settle at the end of October 2022.
“We continue to actively curate the CQR portfolio to drive earnings growth for investors. CQR’s investment in the CDC has been highly successful. We’re now looking to take advantage of strength in the demand for industrial and logistics assets and to recycle these proceeds into an attractive NNN portfolio of Long WALE convenience assets with CPI exposure. Following the settlement of these transactions, 37% of major tenant rent reviews are CPI based and 33% NNN leases. These two transactions have both been secured off-market and are a result of Charter Hall’s strong tenant and investor partnerships,” said Ben Ellis, Charter Hall Retail CEO.
