Charter Hall's low-risk asset portfolio assures steady returns

The myriad opportunities that Australia offers investors who are seeking a market with stability and minimal risk have attracted a flood of capital coming from Asia, particularly from companies looking to diversify outside the region. According to David Harrison, joint managing director of Charter Hall Group, this shows an increasing trend to diversify globally.

"Investors want to put capital into markets with low volatility and steady returns," Harrison says. "This directs capital towards countries like Australia, with stable politics, growth in gross domestic product, and attractive interest rates and yield spreads." Another factor driving the capital inflow, he says, is the fact that many among the present crop of Asian investors were educated in Australia and have a natural affinity for the country. 

Charter Hall is well-placed to benefit from this connection. By leveraging the company's solid reputation and local knowledge, Asian investors can get into various investment portfolios and properties with low risk compared with many Asian markets.

As one of Australia's leading property groups, Charter Hall has cultivated a managed portfolio totalling A$12.7 billion (HK$72.5 billion) since its inception in 1991. The company has 250 properties under management, including office buildings, supermarket-anchored retail centres, and a growing stable of long-lease industrial assets. It has a market capitalisation of A$1.8 billion and generates distributable earnings of approximately A$100 million annually.

Asian investors can partner with Charter Hall by mandate through its property investment funds management business in either pooled funds or majority partnerships where Charter Hall is the minority shareholder. To ensure stable profits, Charter Hall makes certain that its properties have long lease periods, are located where they generate annual rental increases, and leased by tenants with sound business plans.

"Charter Hall offers a unique opportunity to access all mainstream sectors in Australia," Harrison says. "We're the dominant player because we have the track record and the ability to secure and create quality assets for our partners."