Dexus locks in trading profits on industrial and office deals
Property group Dexus displayed the strength of industrial and office markets with a major portfolio sale.
Property company Dexus has locked in profits from trading industrial and office property ahead of its results next month.
The company has sold five industrial assets to the Dexus Australian Logistics Trust it manages, giving it future trading profits for this and next financial year.
The properties were sold to DALT at a price of $269.4m representing a passing yield of 5.3 per cent.
The portfolio comprises five high quality industrial assets across Victoria and NSW and it is 91 per cent occupied with a lease term of 7.4 years.
For DALT, in which Dexus has an interest, the acquisition delivers on its active acquisition and development mandate. When combined with DALT‘s acquisitions of two assets at Greenacre, NSW and Mickleham, Victoria, which were announced this month, the portfolio will increase the size of the fund by about $445m.
Dexus executive general manager, funds management, Deborah Coakley, said the acquisitions continue build on the trust’s strategy to acquire high quality and well leased assets, that deliver favourable total returns.
Dexus chief executive Darren Steinberg said that over the last decade the company had developed and leased 47 industrial projects across 784,000sq m in Sydney, Melbourne and Brisbane.
The sale is expected to contribute about $35m in trading profits pre-tax over fiscal 2021 and fiscal 2022, with further profits subject to favourable leasing outcomes.
Dexus has also exercised its put option in relation to the sale of its remaining quarter interest in the office tower at 201 Elizabeth Street, Sydney for $157.5m, to a Charter Hall-led consortium. This will contribute $34m in trading profits pre-tax in this financial year.
The sale of the first stage of the North Shore Health Hub, currently under development in Sydney‘s St Leonards, will also contribute to profits.
Dexus shares lost 3c to close at $8.62.
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