Newmark Capital has been progressively working toward the listing of a portfolio of hardware and large format retailers with an estimated value of $420m+.
Newmark currently manage an open ended unlisted trust with 4 assets (Maroochydore, QLD, Launceston, TAS, Lake Haven, NSW and Warragul, VIC) leased to Bunnings (73% of income), Kmart, Officeworks, and JB Hi-Fi. The Trust is valued at circa $225m with a WALE of approx 7 years.
Newmark also manage the HomePlus+ Chadstone Homemaker Centre in Victoria leased to Bunnings, The Good Guys, Freedom, Snooze and
Barbeques Galore. This trust has a WALE (by income) of 3.8 years at 30 September 2020 and a valuation of $80.0 million at 30 June 2020.
Newmark Capital are currently considering a restructure proposal to enable both trusts to be listed as a single entity on the ASX and have engaged Credit Suisse, E&P Financial Group and Moelis Australia to advise them on the proposal. Newmark have indicated that they will only implement the Restructure Proposal, if it decides it to be in the best interests of unitholders.
To bolster the chances of a successful IPO, the Group have reportedly acquired a new Bunnings development in Preston, VIC, via a fund through arrangement worth $85m.
The AFR revealed that the new 18,626sq m, three-level flagship warehouse will be leased by Bunnings once finished on an initial 12-year term. Records show Newmark settled on the site for $15 million on February 1, buying it from Conga Freeholds, a company associated with the Valmorbida family, owners of Conga Foods.
The AFR revealed that the new Bunnings is forecast to bring in $3.75 million in annual rent representing a yield of 4.4 per cent on an $85 million acquisition price. Currently under construction, it is being developed by Bunnings at a forecast cost of $43 million with an opening scheduled in 2022.
Bunnings stores have become extremely popular investments over the past 18 months. Data from RESourceData on 16 Bunnings deals over the past 36 months cover over $770m of assets and a weighted average cap rate of 5.0%.
The most recent deals to have been completed include Charter Halls Long WALE REITs acquisition of Bunnings Caboolture for $28m, HomeCo acquisition of Bunning Seven Hills for $56m and EG Funds Management acquisition of a Rockdale Bunnings for $48.7m.
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