LWHP pays $353m for six Bunnings investments

Charter Hall managed Long WALE Hardware Partnership (LWHP) – which includes Telstra Super and VFMC as partners – has paid $353 million for a portfolio of six metropolitan Bunnings stores.

Five are in the east coast capitals of Sydney (Bonnyrig and Caringbah), Melbourne (West Footscray) and Brisbane (Underwood and Virginia). The other is in Adelaide’s Windsor Gardens.

The purchase price reflects a blended 4.63 per cent yield.

The Weighted Average Lease Expiry is 10 years.

CBRE Global Investors Asia Pacific Bunnings Trust, the vendor, was represented by JLL’s Sam Hatcher.

It is understood the landlord is also selling a New Zealand Bunnings in Auckland to the same buyer for c$50m (story continues below).

“We are proud to further expand our strong relationship with Wesfarmers and Bunnings Group,” Charter Hall managing director and chief executive officer, David Harrison, said.

“This transaction represents our seventh Bunnings portfolio acquired since 2006 when we first recognised the strength of the…business, the relatively low rents per square metre of lettable area and the large prime sites [the operator] typically occupy,” the executive added.

The landlord holds 59 outlets rented to the hardware chain worth a total of more than $2.4 billion. Fifty are in major cities.

LWHP fund manager Ben Ellis said the latest deal expands the group’s off-market transaction track record.

Since inception the purchaser added, it has delivered an Internal Rate of Return exceeding 15pc.

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Marc Pallisco

A former property analyst and journalist, Marc is the publisher of realestatesource.com.au.

Marc Pallisco