Charter Hall Retail REIT (ASX: CQR) (CQR or the REIT) today announces its 1H FY25 results for the period ended 31 December 2024.

Charter Hall's Retail CEO, Ben Ellis said, CQR’s portfolio continues to deliver strong operational performance. Our unique blend of convenience shopping centre and convenience net lease assets provides an attractive income growth profile with lower capital commitments. We have been active during the half on both the acquisition and divestment front in our pursuit of maximising future income growth. Our significant investment in the ASX listed HPI, alongside our wholesale capital partner Hostplus, will enhance the overall portfolio’s income growth profile. We are progressing well towards our objective of delivering the highest organic property income and earnings growth from the convenience retail sector.

During 1H FY25 CQR has continued its disciplined portfolio curation strategy to sell non-core assets and to reinvest in attractive new growth opportunities.

Acquisitions:
>CQR has now invested $318m, alongside its wholesale capital partner, to secure a 85.4% stake in Hotel Property Investments Ltd (ASX: HPI). This wholesale partnership intends to move to 100% ownership. HPI is a diversified $1.3bn portfolio of 58 pub and accommodation assets with 100% occupancy and a 9.2 year WALE. Its attractive CPI rent review structure that benefits from fixed collars will deliver consistent rent growth of 3.6% through the cycle.
 >50% acquisition of a convenience shopping centre Glebe Hill Village, Hobart in RP1 for $50.3m2, reflecting a 5.9% yield.
>100% acquisition of Ampol Marsden Park NSW for $21.0m, Cecil Hotel, Southport QLD for $14.3m (leased to Endeavour Group) and Harlow Pub, Richmond Vic for $9.0m (leased to AVC) for an average yield of 6.3%.

Divestments:
 >CQR has divested Lake Macquarie Square, NSW, for $122.5m reflecting a 1.2% premium on book value. Settlement will occur by 30 June 2025.

Financial Highlights:

Operating earnings of $73.1 million, or 12.6 cents per unit (cpu)
 >Distribution of 12.3 cpu
 >Statutory profit of $108.6 million
 >Net Tangible Assets (NTA) per unit of $4.57
 >Balance sheet gearing of 31.8% and look-through gearing of 37.9%
 >Diversified funding sources with a weighted average debt maturity of 3.0 years 

Operational Highlights:

CQR and wholesale partner Hostplus have continued to increase their investment in Hotel Property Investments Ltd (ASX: HPI) with ownership currently at 85.4%, with the intention of moving towards 100% ownership

>Like-for-like net property income (NPI) growth of 3.0% with shopping centre like-for-like NPI growth of 2.5% and net lease retail like-for-like NPI growth of 4.5%
 >Shopping Centre Convenience Retail portfolio occupancy remains stable at 98.7%
 >Continuing positive specialty leasing spreads of +3.8% with 99 specialty lease renewals (+3.1% leasing spread) and 44 new leases (+5.9% leasing spreads)
 >Total MAT growth of 3.4% with supermarket MAT growth of 3.9%1
 >Specialty sales productivity of $11,278 per sqm, up 1.8% from December 2023, a record sales productivity level for the REIT

Charter Hall's Retail CEO, Ben Ellis (Below)