Charter Hall Long WALE REIT will buy a portfolio of chicken farms leased to ASX-listed Inghams, the country’s largest poultry producer, in a $207 million deal.
The real estate itself is owned by US-listed property trust W.P. Carey. The portfolio comprises 27 properties, including hatcheries, feed mills and breeder farms.
The deal reflects a 7.35 per cent average capitalisation rate while the lease has a remaining term of 15.8 years.
The Long WALE REIT, led by fund manager Avi Anger, is one of a stable of listed and unlisted vehicles managed by Charter Hall.
A $125 million raising, underwritten by UBS, will back the deal. Charter Hall, which is the Long WALE REIT’s largest investor, will take up its entitlement in the raising, worth around $24 million.
The acquisition includes large land holdings with the flexibility for Inghams to expand its poultry production to meet the growing demand.
Taking into account the deal and the raising, the Long WALE REIT has lifted its fiscal 2019 operating earnings-per-share guidance to between 26.8¢ and 26.9¢, a 1.3 per increase on previous guidance.