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AQR acquired six OTR stations in May. Source: OTR
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  • APN Convenience Retail REIT (AQR) has acquired six more petrol stations for $35.5 million from OTR on a sale and leaseback agreement
  • The properties, which are located in Naracoorte, Gepps Cross, Glenunga, Kapunda, West Beach and Murray Bridge Eastside, have brand new 20-year leases with fixed annual rent reviews of 2.75 per cent
  • Following the settlement of this portfolio, which is expected to occur before the end of June 2021, AQR’s portfolio will comprise 103 properties valued at $655 million
  • This is just the most recent purchase from the company, with AQR committing over $176 million of acquisitions to date in FY 21, having just acquired six service stations in Queensland for $59 million
  • AQR shares are unchanged and sitting at $3.65

APN Convenience Retail REIT (AQR) has acquired six more petrol stations for $35.5 million from OTR on a sale and leaseback agreement.

The properties, which are located in Naracoorte, Gepps Cross, Glenunga, Kapunda, West Beach and Murray Bridge Eastside, have brand new 20-year leases with fixed annual rent reviews of 2.75 per cent.

Following the settlement of this portfolio, which is expected to occur before the end of June 2021, AQR’s portfolio will comprise 103 properties valued at $655 million.

This reflects a weighted average capitalisation rate of 6.1 per cent and a portfolio weighted average lease expiry of 12.2 years, according to the company.

It is just the most recent purchase from the company, with AQR committing over $176 million of acquisitions to date in FY 21, having just acquired six service stations in Queensland for $59 million.

“We are very pleased with the acquisition of this portfolio,” AQR fund manager Chris Brockett said.

“OTR is an experienced and strong performing convenience retail operator which brings together a number of retail brands and unique retailing skills into a successful, innovative, multi-branded convenience offer, with a proven track record of growth, profitability and scalability,” he commented.

“It is great to introduce another high quality tenant in OTR to the Fund’s tenancy mix, which will represent approximately 5 per cent of the Fund’s total rental income on completion,” he concluded.

The OTR portfolio acquisition will be funded by debt, taking AQR’s gearing to 35.5 per cent on a pro forma basis adjusted for committed acquisitions and the development pipeline, within the fund’s 25 per cent to 40 per cent target range.

The company said there is no change to the previously advised FY 21 funds from operation and distribution guidance of 21.8 to 22.0 cents per security.

AQR’s responsible entity APN Funds Management is currently subject to a takeover bid from Dexus.

OTR, which is wholly owned by Peregrine Corporation, is a South Australian brand that has expanded to approximately 170 integrated retail and fuel offering sites across South Australia, Western Australia, Victoria and New South Wales.

OTR and its related entities have franchise rights to a number of retail businesses including, Wokinabox, Oporto, SA Lotteries, Hungry Jacks, Subway, Krispy Kreme and Guzman Y Gomez, as well as a number of their own retail brands which feature throughout their network.

AQR shares are unchanged sitting at $3.65 at 10:42 am AEST.

AQR by the numbers
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