Centuria Industrial REIT (ASX: CIP) shares are edging lower on Tuesday morning.
At the time of writing, the ASX stock is down slightly to $2.93, broadly in line with weakness across the ASX 200 index.
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What did this ASX 200 stock announce?
Centuria Industrial REIT released its third quarter operating update this morning.
According to the release, the ASX 200 stock has exchanged contracts on four divestments totalling $188 million, at an average 17% premium to prior book value.
These sales include the 67-69 Mandoon Road asset in Girraween for $98 million, the completed 50-64 Mirage Road development in South Australia for $50 million, and two smaller properties in Edinburgh and Epping.
Once completed, the divestments are expected to reduce gearing by approximately 3%.
Development gains
A standout from the update was the sale of the 50-64 Mirage Road development in Direk, South Australia.
The project reached practical completion during the quarter and was sold to an owner-occupier for $50 million.
Management said this represented a 33% premium to total project costs and delivered an internal rate of return of approximately 25% for unitholders.
Centuria also noted progress across several other developments, including recently completed projects in Derrimut, Victoria and Direk, South Australia.
Leasing momentum
Leasing activity also remained positive during the quarter.
The ASX 200 stock agreed lease terms across approximately 14,400 square metres during the period.
For FY 2026 to date, re-leasing spreads averaged 36%, reflecting the under-rented nature of parts of the portfolio and continued demand for industrial property in infill locations.
Data centre opportunities
Centuria Industrial REIT also revealed that it has continued to progress potential data centre opportunities across its portfolio.
During the quarter, it settled the acquisition of a data centre in Wellcamp, Queensland, as well as a strategic asset in Yarraville, Victoria, located near major power infrastructure.
Management also pointed to a potential 40MW data centre opportunity adjacent to its existing Clayton Data Centre in Victoria.
The company said it remains open to potential capital partners, joint ventures, or a demerger of data centre assets to unlock value.
Guidance reaffirmed
The ASX 200 stock has reaffirmed its upgraded FY 2026 funds from operations guidance range of 18.2 cents per unit to 18.5 cents per unit.
It also maintained distribution guidance of 16.8 cents per unit for the year.
Speaking about its outlook, the company's fund manager, Grant Nichols, said:
Looking ahead, we foresee the domestic infill industrial market's supply-demand imbalance to persist with limited construction of new warehouses coupled with consistently high occupier demand as tenants look to strengthen their delivery times and reduce transport costs.
Current macroeconomic uncertainty, resultant of the Middle East conflicts and global oil constraints, is impacting inflation and construction price pressures. These factors are expected to curtail future industrial market supply. The value of high-quality, existing infill industrial assets is expected to increase as the disconnect to replacement cost continues to escalate.
