Real Estate Winners Vs Losers Over the Last Three Months - INA, CQR, CIP, AVN, CMW

Real Estate Winners Vs Losers Over the Last Three Months - INA, CQR, CIP, AVN, CMW

Summary

  • Ingenia Communities acquires 100% interest in the New Victorian lifestyle community for ~A$7 million.
  • Charter Hall Retail REIT has bought A$111.8 million (52%) interest in A$215 million superior quality purpose-built distribution capacity fully leased to Coles Group for 14.5 years.
  • Centuria Industrial REIT’s estimated increase on preliminary portfolio revaluations is 1.3%, or A$21 million.
  • Cromwell Property Group disclosed the signing of a binding contract to purchase seven DHL logistics for A$85.7 million.

Real estate sector comprises groups that hold, develop, as well as operate commercial, residential, and industrial real estate.  Due to COVID-19-induced lockdown restrictions, the real estate players are confronting delays in securing projects because of no construction. COVID-19 pandemic has turned the property market upside down, and the real estate market is in dramatic shock.

According to media sources, house prices in Australia have dropped, and experts are projecting a sustained decline in prices due to the second wave of coronavirus impacting the country, especially Victoria.  The second wave of COVID-19 would delay the economic recovery that many economists believe in the second half of 2020.

RELATED: Real Estate Sector Dynamics & Code of Conduct

Let us now have a look at five ASX-listed real estate stocks- INA, CQR, CIP, AVN, CMW

Ingenia Communities Group (ASX:INA)

Real estate company Ingenia Communities Group is engaged in the management, development, and investment in a portfolio of retirement village accommodation units. The portfolio of the Group comprises Ingenia Lifestyle & Holidays, Ingenia Rental, and Ingenia Gardens.

Ingenia Communities Acquires Complete Interest in New Victorian lifestyle Community

On 29 July 2020, Ingenia Communities revealed the acquisition of a development site (fully approved) in Ballarat, Victoria. Construction of the site started in May 2020, and the first residents are likely to move in May next year.

The site, situated in the Ballarat West Growth Zone, has proximity to facilities, such as health, retail, leisure, and transport. The site was acquired for ~A$7 million from the Ingenia managed 8th gate fund management platform, after recent security holder approval.

Ingenia disclosed that its FY 2020 results would be released on 18 August 2020.

Acquisition of the waterfront Sunnylake Shores Lifestyle Community

On 27 July 2020, announced the acquisition of the waterfront Sunnylake Shores lifestyle community. Moreover, the Group continues its growth on the NSW Central Coast, increasing rental base and development pipeline.

Ingenia Communities confirms that it closed the fiscal year 2020 with settlements of 325 new home along with 179 deposits and contracts on hand as on 30 June 2020. The weighted average sales price stood at A$430,000 while margins were consistent with the H1 FY20.

The FY20 results will provide additional information on the acquisition pipeline as well as the operating performance of the Group.

Ingenia Communities Group CEO, Simon Owen commented:

DO READ: Will there be a Revival of Real Estate Sector in Post Pandemic Era?

Charter Hall Retail REIT (ASX:CQR)

A leading real estate investment trust, Charter Hall Retail REIT is managed by Charter Hall Group (ASX:CHC). Charter Hall Retail REIT is a wholly integrated property group having more than 29 years of experience in property investment and funds management.

Acquisition of Interest worth A$112 million in Coles Group Limited

Charter Hall Retail Management revealed that CQR had bought a 52% interest (worth A$111.8 million) in a A$215 million purpose-built distribution capacity fully leased to the retailer Coles Group Limited (ASX:COL) for 14.5 years. The CQR retail portfolio now includes 276 conveniences as well as extended WALE retail properties.

The distribution facility is in Adelaide’s prime industrial precinct of Edinburgh Park, South Australia. It is utilised by Coles Group as its sole distribution centre to offer service to all its retail stores in the Northern Territory and South Australia.

This acquisition raises the portfolio as well as major/anchor tenant WALE by 0.2 years. It also takes Long WALE retail property weighting to approximately 13% of the total portfolio of CQR, comprising of the 19.4 years WALE BP portfolio including this Coles WALE investment for 14.5 years.

Centuria Industrial REIT (ASX:CIP)

Australia’s largest domestic pure-play industrial REIT Centuria Industrial REIT is engaged in building investment properties portfolio within the country. The high-quality industrial assets portfolio of CIP is underpinned by quality and diverse tenant base.

On 6 July 2020, Centuria Industrial REIT provided valuation and portfolio update for June 2020. The company disclosed that the estimated increase in preliminary portfolio revaluations was 1.3% (A$21 million).

Moreover, Rent collections for CIP were robust throughout April to June 2020, averaging more than 95% across the portfolio.

CIP continued to benefit from leasing demand in the industrial sector, and value-add initiatives were executed during the April to June 2020 period. Successful leasing results were attained at Hemmant (QLD) asset for 70% of its space.

Centuria Industrial also acquired an industrial development site in Brisbane with an expected end value of A$17.5 million. The development is projected throughout one year period.

Additionally, FY results of CIP will be announced on 5 August 2020 and will comprise further details relating to valuations of the individual property along with revenue impacts from COVID-19.

Aventus Group (ASX:AVN)

Aventus Group includes Aventus Holdings Limited and Aventus Capital Limited as the responsible entity for Aventus Retail Property Fund. The Group is Australia’s largest fully-integrated manager, developer, and owner of large format retail centres in the country with a portfolio of twenty centres valued at A$2.2 billion.

On 16 July 2020, Aventus Group disclosed that the Distribution Reinvestment Plan (DRP) issue price is A$2.14 per stapled security for the period ended 30 June 2020. DRP stapled securities will be issued on the distribution payment date on or around 28 August 2020 & will rank equally with existing stapled securities.

On 23 June 2020, Aventus Group provided portfolio and trading update and disclosed that the operating performance of the portfolio had increased substantially through May and June. Moreover, all 20 centres of AVN were open and trading at pre-COVID-19 opening hours.

The traffic data from the Group portfolio centres indicates a rebound in consumer shopping activity after the relaxation of government restrictions and the re-opening of stores. Month to month figures relative to 2019 data is represented below-

Cromwell Property Group (ASX:CMW)

Diversified real estate investor Cromwell Property Group has its operations on three continents along with a global investor base. The Group owns, invests, and manages in commercial property and has its operations across Australia, Europe, and New Zealand.

Cromwell Acquires Italian DHL Logistics Portfolio

On 29 July 2020, Cromwell Property Group disclosed that it had signed binding contracts to purchase seven DHL logistics for A$85.7 million in conjunction with IGIS Asset Management. The acquisition will settle in September 2020.

Moreover, Cromwell will fund its share of the acquisition from existing cash reserves.

It is anticipated that the assets will form the seed portfolio for a new Cromwell European Logistics Fund with a target Gross Asset Value of A$650 to A$800 million.

Moreover, Cromwell revealed that on 13 July 2020 the Stratus Cromwell Data Centres Fund was signed after the non-binding heads of terms agreement. Now the Group is working on having definitive documentation approved and signed by the Cromwell Board and will provide a further update in due course.

Stock Performance

The stock performance of the above-mentioned real state stocks, as on 29 July 2020, are as below:

 


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