Arena REIT (ARF) is an internally managed stapled real estate group that owns, manages and develops specialised real estate assets across Australia. Arena's property portfolio comprised 228 early learning centre (ELC) properties and development sites (85% of portfolio by value) and 11 healthcare properties (15% of portfolio by value)
FY20 financial highlights:
Growth has been consistent YoY and current share price seems undervalued
Dividend was deferred in March despite cash in excess of the normal distribution amount. However, it was paid in full in June. FY21 DPS guidance of 14.4-14.6 cents per security reflecting growth of 3-4% over FY20. DRP available at 1.5% discount
With the majority of the portfolio ELC, there is a risk they will be shut or cannot pay rent due to Covid-19. The share price seems to reflect this market sentement. However, this doesn't appear to be the case in the latest results and I suspect the government won't allow anything to happen to ELCs. And 14 yr WALE should mean little impact. However, continue to monitor for further impact of Covid-19
- Increase children in future due to lockdown?
- Increased unemployment will reduce childcare numbers