APN Convenience Retail Snatches up Some Prime Land (ASX:AQR)

ASX AQR Share Price - APN Convenience Retail REIT

The land grab frenzy continues!

Today, APN Convenience Retail REIT [ASX:AQR] has acquired a Brisbane Airport Link Service Centre. A prime piece of land that sees over 100,000 vehicles pass by daily.

The news has seen the AQR share price rise by 1.4% at time of writing.

Prime spot, prime tenants

At a cost of $10.5 million, the site hasn’t come cheap for AQR. But, with a purchase yield of 6.15%, it certainly has a lot of upside.

Sweetening the deal is the list of tenants at the site. With a 15-year lease to an Ampol (Caltex) service station and convenience store being the crown jewel. Accounting for 78% of entire centre’s income.

As AQR’s fund manager, Chris Brockett noted:

This acquisition represents an outstanding opportunity to own a prominent service centre where all tenancies benefit from visual exposure as well as introducing another major fuel tenant, Ampol, to the Fund’s tenancy mix.

The site is strategically located in a precinct that will service high volumes of diesel sales given the density of industrial holdings within the immediate area, and its proximity to courier, taxi, and car rental services stemming from Brisbane Airport.

All of which will help ensure this site is a fantastic long-term source of income. Bringing AQR’s total portfolio of 80 properties to an approximate value of $455 million.

A good result for the company and shareholders.

Long-term outlook a mystery

However, there have been plenty of rumblings on the topic of a property crash.

Experts and pundits alike are divided over whether land values will rise or fall. Especially with the pandemic threatening a second wave of lockdowns.

Whether we’ll see a short-term correction or crash is highly suspect.

Our resident property expert — Catherine Cashmore — isn’t fazed though. According to her cyclical forecasting, any short-term pressure will be irrelevant.

The big crash, the one we’re always hearing about, won’t come until 2026 according to Catherine. Opening up a limited window of opportunity for a potential property boom over the next five years.

You can read all about it in her report, for free, right here.

Because if she’s right, then the REIT sector may be about get even more ravenous.


Ryan Clarkson-Ledward,
For Profit Watch