Real estate funds management company Centuria Capital Group‘s (ASX: CNI) shares will be on watch tomorrow. The Centuria Capital share price will remain in a trading halt until tomorrow morning, as requested by the company prior to today’s ASX announcements.
Centuria focuses on both unlisted and listed Australian real estate investment trust (REIT) property funds as well as investment bonds.
The Centuria Capital share price was on tear in the early weeks of 2020, gaining 24% from 2 January through to 19 February. Like most ASX shares, particularly property shares, it was hit hard by the COVID panic selling, falling 49% from 19 February through to 23 March.
Since then, the share price is up 61%, for a year-to-date gain of 3%. By comparison the S&P/ASX 200 Index (ASX: XJO) is down 9% in 2020 (at the time of writing).
What did Centuria Capital announce?
Centuria announced it has acquired the NZ$178.3 million (AU$165.8 million) Visy Glass industrial facility in Auckland, on a 20-year sale-and-leaseback, triple net lease. The facility – New Zealand’s only glass bottle and jar manufacturing site – was acquired via Centuria’s New Zealand platform, Augusta Capital.
Centuria has now secured more than AU$700 million of industrial and healthcare assets since the beginning of the 2021 financial year. It reports another $300 million of assets are under due diligence, and forecasts its assets under management (AUM) will expand to $10 billion.
In light of the increased earnings associated with the growth of its AUM, the company also upgraded its FY21 guidance. Operating earnings per security (EPS) guidance increased 9.1% to 11.5 –12.5 cents per security. Distribution per security (DPS) guidance increased 5.9% to 9.0 cents per security.
The Visy Glass facility will be the largest single asset unlisted fund launched by Centuria.
It will be funded by a $100 million equity raising comprised of an $80.5 million entitlement offer and a $19.5 million fully underwritten institutional placement.
The company reports that following the equity raising, it will have approximately $105 million of working capital available.
A word from Centuria’s CEOs
Addressing the new acquisition, John McBain, Centuria Joint CEO, said:
The Visy Glass acquisition in New Zealand follows the recent $416.7 million acquisition of Telstra’s data centre in Victoria and Centuria is pleased to partner with both groups in these initiatives. Centuria has upgraded both its operating EPS guidance and DPS guidance following strong property funds management activity to date in FY21 with a meaningful proportion of these earnings generated from our New Zealand business unit underpinning our ongoing confidence in this acquisition.
Jason Huljich, Centuria Joint CEO, added:
The industrial sector in both Australia and New Zealand has enjoyed exceptional growth over the past three years and we continue to take advantage of these tailwinds. Together with recent healthcare property transactions, Centuria is on track to expand assets under management to $10 billion, a 14% increase… since the end of FY20.
With a lot of new information for investors to sort through, the Centuria Capital share price will be one to watch tomorrow.
More reading
- Centuria Capital (ASX:CNI) delivering on FY21 strategy
- Centuria Capital’s fund managers’ insights on A-REITs and unlisted property funds
- Top ASX Stock Picks for October 2020
Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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