Dexus has added another two service stations to its growing Convenience Retail REIT in deals worth more than $21 million.
The latest acquisitions, both in Queensland, were struck on an average yield of 5.5 per cent, have pumped up its $783-million petrol station portfolio to include over 110 locations.
The two purpose-built, modern metropolitan convenience retail properties are in Brisbane’s south-east—Puma Chandler and BP Brendale.
The service station in Chandler was built in 2019 and is anchored by Chevron with 13.2 years remaining on its lease, supported by three specialty retail tenancies. The recently completed Brendale facility comprises a BP petrol station and Wild-Bean-branded convenience store.
Dexus fund manager Chris Brockett said the acquisitions reinforced the company’s active and disciplined approach to creating a resilient portfolio of high-quality assets.
“Both [assets] are recently constructed assets, with long WALEs and favourable rent reviews providing income security and a sustainable source of income growth,” Brockett said.
“While we have taken the opportunity to acquire quality properties that enhance value, we continue to actively review capital management initiatives to close the trading discount to NTA per security.”
Dexus already has a strong presence in Queensland with 60 of its service stations, worth $350-million, in the state, predominantly tenanted by Chevron.
While Dexus remains the country’s biggest office landlord, it has identified funds under management as a growth engine to give the group access to an increased range of retail and industrial assets during the uncertainty of the pandemic.
In May, Dexus moved to acquire Melbourne-based APN Property in a deal worth $320 million, pushing its funds management portfolio to $23.9 billion.
At the time, the APN Property platform had $2.9 billion of funds under management, $134 million of co-investments in its managed vehicles and two ASX-listed property trusts.
In September, the Dexus-managed listed APN Convenience Retail REIT exchanged contracts to buy the Warrego Highway Travel Centre at Riverview, near Ipswich in Queensland, and conditionally exchanged contracts to acquire the Dubbo Service Centre, NSW, for a combined $24 million.
The Riverview facility is a purpose-built travel centre constructed in 2019 and is 100 per cent occupied, with the site leased to major tenants Ampol and the hamburger chain Carl’s Jr.
The Dubbo asset was acquired via a fund through structure and will comprise a Mobil service station and a Carl’s Jr restaurant with drive-through.
Construction recently began and is due to be complete by March 2022.