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- As it meets its June quarter objectives, Qualitas Real Estate Income Fund (QRI) has seen robust commercial real estate (CRE) debt origination across all property sectors
- The trust reported that it met its investment objectives of target returns, portfolio diversification and capital preservation during the quarter
- It posted a 6.11 per cent per annum net return and a 6.15 per cent per annum distribution return attained (three-month)
- Qualitas Group director real estate and QRI portfolio manager Nick Bullick says QRI closed eight new loans worth $189 million during the quarter
- Shares are trading slightly higher, up 0.31 per cent to trade at $1.62 each at 2:33 pm AEST
Qualitas Real Estate Income Fund (QRI) has posted strong commercial real estate (CRE) debt origination across all property sectors as it hits its target for the June quarter.
The manager of the fund said the trust met its investment objectives of target returns, portfolio diversification and capital preservation during the quarter.
The trust posted a 6.11 per cent per annum net return and a 6.15 per cent per annum distribution return attained (three-month), across a loan portfolio that is predominately senior first mortgage.
Both the returns were in accordance with the distribution guidance issued previously of at least around six per cent per annum through June 30, 2021, the company said.
QRI, across its ASX listed trust and wholesale funds, has a roughly $475 million CRE debt pipeline.
“Origination of new opportunities continued to be strong and is well diversified across property sectors,” Qualitas Group director real estate and QRI portfolio manager Nick Bullick said.
“We firmly remain focused on ensuring we achieve the best risk-adjusted returns for the trust and a continued emphasis on borrower quality.”
Mr Bullick said QRI had closed eight new loans worth $189 million during the quarter.
These loans were financed with new capital and repayments totalling $98 million including the complete redemption of the $26.5 million Arch Finance Warehouse Trust note investment, which QRI chose to leave in order to align the trust’s exposure to direct loan investments.
A unit purchase plan offering that was completed on June 29 raised an additional $12.7 million in new capital, with the total trust capital now $428 million.
“We are seeing no major distress in the CRE debt market and generally those conditions in Australia are more favourable than offshore markets,” Mr Bullick said.
“This has led to an increase in investment activity from domestic and offshore alternative lenders in recent months.”
Mr Bullick said QRI was closely watching the market more generally in light of recent lockdowns in Sydney and Melbourne.
“There is only 10 per cent portfolio exposure to construction loans for projects still under construction, all located in Melbourne where construction sites have not closed,” he said.
Shares are trading slightly higher, up 0.31 per cent to trade at $1.62 each at 2:33 pm AEST.
