Centuria FUM Grows To $4.15 Billion With Three New Property Acquisitions

Centuria Property Funds Limited, as Responsible Entity of Centuria Metropolitan REIT (CMA) and a wholly owned subsidiary of CNI, has entered into agreements to acquire two new commercial office assets located in Perth for $91.8 million.

These assets, coupled with the acquisition of the Target Head Office announced on 28 June 2017, resulted in $150 million of total new acquisitions with an initial funding obligation of $95 million.

To partially fund the acquisitions, CMA will undertake an underwritten equity raising to raise approximately $90 million at a fixed issue price of $2.35 per CMA security.

The acquisitions were acquired on an average capitalisation rate of 7.1% with fixed rental reviews of between 3.25 – 3.75% p.a. improving the structured rent growth profile of the REITCMA Trust Manager Nicholas Blake said the acquisitions were highly complementary to the CMA portfolio as metropolitan assets which generate income returns and offer the potential for capital growth through active management.

“Income from the two Perth assets is secured by the major occupiers WA Government (WA Police), Insurance Australia Group Ltd and international consultancy firm Hatch & Associates, with the acquisition pricing at a significant discount to East Coast markets.

“The two Perth assets are the REIT's first exposure to the Perth market and will represent 12% of the total CMA portfolio.

“The acquisition of the Target Head Office at Williams Landing will provide exposure to a first generation asset purpose built for a high quality tenant on a long-term lease with attractive fixed rental increases,” he said.

The purchase price of the Acquisitions is supported by independent valuations and reflects a weighted average capitalisation rate of 7.1% and weighted average lease expiry (WALE) of 6.5 years.

The $150 million in new property acquisitions increased CNI funds under management (FUM) to $4.15 billion.