The Charter Hall Retail (ASX: CQR) share price is in the green. At close of trade, shares in the real estate investment trust (REIT) were trading for $3.94 – up 1.55%. For context, the S&P/ASX 200 Index (ASX: XJO) is 0.09% higher.
The REIT comes into focus after announcing a valuation update, a new acquisition, and distributions for the second half of the financial year.
Let's take a closer look at today's announcement.
Why the Charter Hall share price is rising
Positive revaluation
According to the statement, Charter Hall says it has reassessed 64% of its portfolio by gross value and this segment has appreciated by 4.1% – or $143 million. The average capital rate of the portfolio has decreased from 6.03% to 5.81%. Net tangible assets per security have increased from $3.77 to $4.02.
Charter Hall CEO, Greg Chubb, said:
Today's portfolio valuations demonstrate the resilience and attractiveness of our Convenience Retail portfolio. Our shopping centre portfolio has proven its resilience through the challenges of the last 12 months with strong occupancy, rent collection and retail sales growth. This is now being reflected in asset valuation gains.
Latest acquisition and second half dividend
As well, Charter Hall declared it has bought the Butler Central Shopping Centre in Western Australia, from Woolworths Group Ltd (ASX: WOW), for $51.2 million – a 6.0% cap rate. Besides Woolworths stores, another ASX retailer in the centre is Reject Shop Ltd (ASX: TRS).
The transaction will settle in July 2021 and is being funded using existing debt facilities.
Finally, Charter Hall says it will pay a dividend of 12.7 cents per security to shareholders for the H2 of FY21. This is an increase on the first half of the financial year, which was 10.7 cents per security.
Charter Hall share price snapshot
Over the past 12 months, the Charter Hall share price has increased 14%. However, before the COVID market crash, Charter Hall shares were trading for $4.94 each. Its 52-week high is only $4.08.
For a sense of how devastating the pandemic was for the REIT, between 5 March and 23 March 2020, its share price fell 43.1%. Fourteen months later it has still not fully recovered.
Charter Hall has a market capitalisation of $2.26 billion.
