Image: Canva.
  • Big purchases include cattle, cropping and macadamia orchards, and a BIG4 holiday park
  • Several industrial properties also went up for sale
  • Retail is looking positive as the country continues its road to recovery

It’s a busy start to the week, with acquisitions across most spheres of real estate, from developments and residential, to industrial, farming, and holiday parks.

The broader market

The ASX200 closed today at 7,423.90 points.

Image: Google.

Top-performing ASX listed real estate company shares: 10 November 2021

Company Code Price ($) Change (%)
Cedar Woods CWP 5.77 +2.12
The Agency AU1 0.051 +2.00
Irongate IAP 1.62 +1.89
US Masters Residential Property URF 0.305 +1.67
Charter Hall Social Infrastructure REIT CQE 3.80 +1.33

Source: ASX

In addition to the top performers, the bottom five (from fifth lowest to lowest) were:

Least-performing ASX listed real estate company shares: 10 November 2021

Company Code Price ($) Change (%)
HomeCo HMC 7.72 -3.14
Axiom AXI 0.091 -4.21
McGrath Limited MEA 0.66 -5.04
Servcorp SRV 4.50 -5.06
AIMS Property Securities Fund APW 1.17 -6.40

Source: ASX

The movement…

Monday kicked off to news Cedar Woods (ASX: CWP) added 1200 lots to its national portfolio, making a $49.5 million acquisition of an 86 hectare site in Eglington. The site is located in 45 kilometres north west of Perth’s CBD, and was purchased from private vendor Eglington Estates Pty Ltd.

CWP said the lots add to the company’s development pipeline, and that it “is expected to contribute to the company’s earnings over 11 years from FY24.”

Lifestyle Communities (ASX: LIC) announced it acquired a site in Mickleham, Victoria, which has capacity for some 187 homes and is located within the Merrifield estate.

LIC also announced that the Victorian Civil and Administrative Tribunal (VCAT) had upheld the Council’s refusal to grant a planning permit for the proposed Lifestyle Community in Tyabb. LIC said it decided not to appeal.

LIC also said the contracts for acquisition of the land at Tyabb were conditional on obtaining a planning permit and will be allowed to lapse. As a result, LIC will record a one-off expense of circa $1 million dollars related to option fees on the land and legal and consulting fees to pursue the planning permit.

Garda Diversified Property Fund (ASX: GDF) provided a leasing update to the market, two new leases were executed at Botanicca 9 for a total of 1,332 square metres of office space.

The tenants are Berry Street, and Servier, occupying 630 square metres, and 702 square metres respectively. Both lease terms are for seven years, with Berry Street commencing in December this year, and Servier in January 2022.

Planet Innovation has extended its lease at Box Hill by a further three years; the lease will now expire in November 2030. GDF said the extension increases the building WALE by income of 9.0 years.

REA Group (ASX: REA) announced the appointment of Kelly Bayer Rosmarin as an independent non-executive director of the company, effective 1 January 2022. Ms Bayer Rosmarin is CEO of Optus and Consumer Australia, and prior to Optus, Ms Bayer Rosmarin spent 14 years with Commonwealth Bank of Australia.

Rural Funds Group (ASX: RFF) also announced several acquisitions on Monday, including cattle, cropping, and macadamia properties.

Cow rural economy property
The strength of the rural economy is feeding into property prices. Image – Canva.

RFF said the properties include a 1,917 hectare cattle and cropping property in The Pocket, and a 4,130-hectare cropping property in Baamba Plains. Included with those two acquisitions is 20,733 megalitres of water entitlements which are currently underutilised, according to RFF.

Rural Funds Management (RFM) said it plans to utilise surplus water entitlements to improve the productivity of the properties.

RFM said it will initially operate both properties on behalf of RFF, enabling the commencement of productivity developments prior to seeking lessees.

Settlement of the properties is expected this month, The Pocket was purchased for $13.8M and Baamba Plains $32.0M.

The two macadamia orchards purchased are located in Beerwah and Bauple in Queensland, totalling 475 hectares. The company said the acquisition amount of up to $63.1 million includes shares in Marquis Macadamias. Settlement is expected to occur in December this year.

Centuria Industrial REIT (ASX: CIP) announced it acquired four freehold industrial assets across the eastern seaboard. Worth a combined $129.4 million, the properties include 82 Rodeo Road, Gregory Hills in NSW; 30 Fulton Drive, Derrimut and 870 Lormier Street, Port Melbourne, both in Victoria, and 55 Musgrave Road, Cooper Plains, Queensland.

Properties State Purchase Price Initial Yield Cap rate GLA (sqm) WALE (yrs) Occupancy
82 Rodeo Road, Gregory Hills NSW $70.0M 3.70% 3.88% 22,439 4.2 100%
30 Fulton Drive Derrimut VIC $20.6M 4.90% 4.50% 10,733 2 100%
870 Lormier Street, Port Melbourne VIC $18.0M 4.10% 4% 2,392 2.5 100%
55 Musgrave Road, Cooper Plains QLD $20.8M 4.10% 5.25% 10,962 3.4 89%

Desane Properties, a controlled entity of Desane Group Holdings Limited (ASX: DGH) announced a $7 million net revaluation uplift on its property portfolio.

The increase sees a 49% increase in valuation for a Queensland property, and 27% increase for a NSW property.

Revaluation movement (since 30 June 2021)
$M %
16 Industrial Avenue, Wacol QLD 5 49
91 Thornton Drive, Penrith NSW 2 27
Total 7 40

Desane said the valuation uplift has resulted in a 12 cent per share increase in net tangible assets to $1.56 per share.

Cromwell Property Group (ASX: CMW) announced that it appointed Brett Hinton to the newly created role of Head of Funds Management – Australia.

On Tuesday, Vicinity (ASX: VCX) announced it exchanged contracts to sell 50% interest in Runaway Bay Centre in Queensland to Perth-based Greenpool Capital in partnership with Qualitas for $132 million, an 18% premium to 30 June 2021 book value.

VCX also announced its acquisition of 50% interest in Harbour Town Premium Outlets Gold Coast from Australia Prime Property Fund Retail for $358 million is now unconditional after co-owner Lewis Land Group waived its pre-emptive right to purchase the interest. The Harbour Town acquisition is expected to settle on 30 November 2021.

Also on Tuesday and also in the shopping centre space, Scentre Group (ASX: SCG) provided an operational update, announcing the Group has collected $1.8 billion in gross rent for the 10 month period to 31 October 2021, an increase of $607 million since 30 June 2021.

During the nine months to 30 September 2021, the Group completed 2,010 lease deals, including 868 new merchants, welcoming 191 new brands to the portfolio. Portfolio occupancy remains strong at 98.5% at the end of September 2021.

Today, Ingenia (ASX: INA) announced it acquired BIG4 Beacon Resort. The off-market deal for the Bellarine Peninsula holiday park was made for $37 million.

That’s the latest in ASX listed real estate companies, where it feels as if the latest online sales frenzy has also hit the real estate market.

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