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Charter Hall powers to $52b in funds under management

Diversified funds manager and investor powerhouse Charter Hall has boosted its funds business to a record $52 billion, based on a fresh round of asset value rises.

Its latest investor update reveals the funds under management (FUM) platform will generate gross valuation rises of $3.3 billion, resulting in the end-of-financial-year forecast rising to $52 billion. Over the year, the FUM has risen $12 billion, or 28 per cent.

Charter Hall is an ASX-listed $7.1 billion diversified manager that specialises in assets with long leases across the traditional sectors of office, retail and industrial as well as fast-moving consumer foods, healthcare and childcare, among others.

David Harrison, Charter Hall’s chief executive, outside his offices in Martin Place, Sydney.

David Harrison, Charter Hall’s chief executive, outside his offices in Martin Place, Sydney.Credit:Peter Braig

Group chief executive David Harrison said there had been “impressive” valuation gains across most sectors, delivering strong returns for investors.

“Our focus on securing long-leased assets to high-quality tenants, often secured through off-market sale-and-leaseback transactions, or through our develop-to-core development pipeline, continues to deliver attractive enhanced returns,” he said.

Mr Harrison has led the charge in boosting FUM, with Charter Hall now having a portfolio of 1395 high-quality, long-leased properties that are owned and managed by a suite of listed and wholesale funds.

Macquarie analysts led by Stuart McLean said the rise in FUM was above his expectations and augured well for upgrades to the 2022 financial year earnings.

“For every $1 billion of FUM, base fees in isolation result in a 0.8 per cent upside to earnings,” Mr McLean said.

On a sector breakdown, the latest valuations show a 10.8 per cent rise in industrial assets, reflecting demand for warehouse space as online shopping booms; its long-weighted average lease asset values rose 8.7 per cent, while office rose 2.9 per cent.

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