Another Bunnings for Charter Hall

by | Aug 19, 2021

Charter Hall recently spent $48.8 million for a Bunnings investment in an Adelaide growth corridor, which is reportedly 10 per cent over guide, according to a recent report.

The Cromwell Funds Management deal for the Munno Para West store reflects a 4.25 per cent net passing yield. The unbuilt property was valued by the vendor at $27.5 million when it was acquired from GIC in late 2015, according to the report.

The asset is set to switch between trusts – from the Cromwell Direct Property Fund to Charter Hall Industrial Fund No 4.

Now holding more than 60 bunnings outlets, Charter Hall paid $49 million for the Baldivis store, located 45 kilometres south of Perth. Just last November the manager was said to have outlaid $353 million on six more investments leased to the hardware chain, in New South Wales, Queensland and in South Australia at Windsor Gardens – also north of Adelaide, according to the report.

Located on the north east corner of Curtis and Frisby roads, the 4.11-hectare Munno Para West site features a 16,936 square metre showroom, as well as over 400 car parks, with Bunnings reportedly having seven years left on its lease but with six options can stay until 2064.

Munno Para West is considered South Australia’s fastest growing area in regards to population as it falls within the Playford council area and is about 13 kilometres south of Gawler – a gateway to the Barossa region.

Charter Hall Direct Chief Executive Officer, Steven Bennett, said in the report that the acquisition is in line with its strategy for the DIF4 fund and builds on its momentum in the industrial and logistics sector.

“DIF4 has completed $230 million in acquisitions over the past three months and $1 billion over the past 12 months, demonstrating the ability for the fund to deploy capital in a highly sought-after asset class that provides accretive results,” Mr Bennett said in the report.

Colleague Jack Walters, Head of Industrial Transactions, also said in the report that the group has been acquiring investments leased to tenant customers in the essential services and non-discretionary asset classes “which have continually demonstrated to be a resilient and defensive investment and served all of our funds very well.”