Here’s why the APN Industria REIT (ASX: ADI) share price is frozen today

Strong growth in e-commerce has seen demand for quality industrial and logistics space pick up.

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The APN Industria REIT (ASX: ADI) share price is frozen due to a trading halt at the company’s request.

ADI, a real estate investment trust (REIT), owns a portfolio of industrial and business park assets across most of Australia’s major capital cities.

The company requested a pause in trading on the ASX pending today’s announcement on major property acquisitions and a proposed equity raising.

What property acquisitions did APN Industria announce to the ASX?

ADI reported it has entered into agreements that will enable it to acquire interests in a portfolio of 51 industrial properties and development opportunities for $368 million.

The acquisition is taking place alongside Dexus (ASX: DXS), which released a separate announcement to the ASX.

ADI said its acquisitions include:

  • A 33.3% interest in Jandakot Airport, located in Perth, Western Australia. The industrial portfolio includes 49 properties, roughly 80 hectares of developable land, and a general aviation operating business
  • A 100% interest in 2 Maker Place, Truganina, Victoria. This is a 30,364 square metre logistics facility fully leased to Australia Post. It also has adjoining developable land
  • A 50% interest in Lot 2, 884-928 Mamre Road, in Kemps Creek, New South Wales. This is a 42,515 square metre fund-through development project to be delivered in May 2023.

Dexus will own the other 66.7% interest in Jandakot and will acquire the remaining interest in Kemps Creek.

Commenting on the acquisitions, APN Industria REIT fund manager, Alex Abell said:

This transaction represents a compelling opportunity for Industria to achieve transformational growth and deploy capital into assets with significant value creation opportunities. The acquisitions capitalise on the strong momentum in the industrial sub-sector, with growing ecommerce take-up in Australia set to drive approximately 2.4 million square metres of industrial space take-up between now and 2025 …

The acquisitions also introduce a significant development pipeline that has the potential to deliver future value upside through further leveraging Dexus’s fully integrated platform.

ADI said it will partly fund the acquisitions via a fully underwritten $350 million equity raising. The new shares will have an issue price of $3.45. This is some 8% less than yesterday’s closing price of $3.74 per share.

The equity raising comprises a $100 million institutional placement and a $250 million 1-for-3 non-renounceable entitlement offer. The remainder will be funded via existing and new bank debt facilities.

Dexus reported it plans to take up its full $40 million under ADI’s Entitlement Offer and provide a commitment to sub-underwrite up to approximately $39 million.

ADI share price snapshot

The ADI share price is up 31% year to date compared to 10.5% for the All Ordinaries Index (ASX: XAO).

Over the past month, the APN Industria REIT share price has risen 4%.

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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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