Why the Charter Hall (ASX:CHC) share price is moving higher

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The Charter Hall Group (ASX: CHC) share price is moving higher in morning trade, up 2%.

Below we take a look at the latest funds under management (FUM) update from the integrated property group.

What funds update did the Group provide?

Charter Hall’s share price is rising after the company reported a strong increase in FUM.

According to the release, Charter Hall’s FUM Platform will generate gross valuation increases of $3.3 billion. That figure includes $600 million of development capital expenditures.

Charter Hall now forecasts its Group FUM will increase to roughly $52 billion by 30 June. That represents 28% growth in FUM in the 2021 financial year, an increase of $12 billion.

Commenting on the FUM update, Charter Hall’s CEO David Harrison said:

Today’s valuation outcomes demonstrate the success of our investment selection process. We’ve seen impressive valuation gains across most sectors, delivering strong returns for our investors. Our focus on securing long-leased assets to high-quality tenants, often secured through off-market sale-and-leaseback transactions, or through our develop-to-core development pipeline, continues to deliver attractive enhanced returns.

Harrison said the company had secured $6.0 billion in net acquisitions in the 2021 financial year, with $7.8 billion of new acquisitions and $1.8 billion worth of assets sold.

Charter Hall’s net valuation in FY21 increased by $3.7 billion, in addition to $1.8 billion of capital expenditures during the period.

Breaking the valuation growth over the past 12 months down by sector, its industrial assets increased by 15.5%, office assets increased by 3.7%, long weighted average lease expiry (WALE) retail increased by 14.5%, social infrastructure increased by 9.9%, and shopping centre retail increased by 1.3%.

Charter Hall share price snapshot

Charter Hall shares gained 59% over the past 12 months. That’s more than double the 26% gains posted by the S&P/ASX 200 Index (ASX: XJO) over that same time.

Year-to-date the Charter Hall share price is up 3%.

Charter Hall pays a 2.3% dividend yield, 40% franked.

Should you invest $1,000 in Charter Hall right now?

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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