Charter Hall’s wholesale partnership, LWNP, has acquired a portfolio of six Bunnings Warehouse retail stores for A$353m.
The assets are located in prime metropolitan areas across Australia, with properties in Sydney, Melbourne and Brisbane.
The portfolio was acquired on a yield of 4.63% and has a WALE of 10 years, with 2.5% annual rent reviews.
Bunnings Warehouse is an Australian DIY, garden and hardware chain, that was founded in Perth, Western Australia in 1886 by two brothers who had recently arrived in Australia from the UK.
The company was bought by Australian conglomerate, Westfarmers, in 1994 and now has a total of 375 trading locations around Australia and New Zealand. In May 2020 the company announced that it would close seven stores due to the impact on trading of the COVID pandemic. However, the company has deep pockets having reported revenues of A$14.9bn for the year ended 30 June 2020.
Commenting on the acquisition, Charter Hall Managing Director and Group CEO, Mr David Harrison, said, “Across the Charter Hall platform we now have in excess of A$2.4bn invested in 59 Bunnings stores, 50 of which are located in metropolitan locations. This transaction represents our seventh Bunnings portfolio acquired since 2006 when we first recognised the strength of the Bunnings business, the relatively low rents per square metre of lettable area and the large prime sites Bunnings typically occupy.”
The LWHP wholesale partnership also includes VFMC, Telstra Super and CHC as partners.
LWHP Fund Manager, Mr Ben Ellis added, “This off-market acquisition extends the Bunnings relationship, expands our off-market transaction track record and enhances the diversity and breadth of the LWHP partnership which has been one of our most successful partnerships delivering an IRR since inception exceeding 15%.”