Charter Hall Long WALE REIT Delivers Steady Growth and $139M Valuation Boost
Charter Hall Long WALE REIT reported a solid first half for FY26, with a 2% rise in operating earnings per security and a $139 million uplift in property valuations, underpinned by a diversified portfolio and strong tenant demand.
- 2% growth in operating EPS and DPS to 12.75 cents per security
- $139 million net valuation uplift across 86% of portfolio
- 99.9% occupancy with a 9.2 year weighted average lease expiry
- $1.1 billion in new interest rate hedging completed
- FY26 guidance reaffirmed with 6.8% distribution yield
Strong Half-Year Performance Amid Market Stability
Charter Hall Long WALE REIT (ASX – CLW) has released its half-year results for FY26, demonstrating steady financial performance and portfolio resilience. The REIT reported a 2% increase in operating earnings per security (EPS) and distributions per security (DPS), reaching 12.75 cents for the six months ending 31 December 2025. This growth reflects the REIT’s focus on long-term leases with blue-chip tenants across essential industries.
The portfolio’s net valuation rose by $139 million, a 2.8% increase during the half, supported by independent valuations covering 86% of the assets. This uplift contributed to a 2% growth in net tangible assets (NTA) per security, now at $4.68, signaling enhanced underlying asset quality.
Portfolio Strength and Tenant Quality
Charter Hall Long WALE REIT’s portfolio remains robust, with occupancy near 100% and a weighted average lease expiry (WALE) of 9.2 years. The REIT’s diversified $6 billion portfolio spans convenience retail, industrial and logistics, office, and data centres, all leased predominantly to government bodies, ASX-listed companies, and multinational corporations.
Notably, 52% of lease rent reviews are linked to the Consumer Price Index (CPI), providing a natural hedge against inflation. The REIT’s triple net leases (NNN), where tenants cover property expenses, account for 49% of the portfolio, further reducing landlord risk.
Active Capital Management and Hedging Strategy
During the half, Charter Hall completed $455 million in property acquisitions, including a 49.9% stake in the Coles CoreWest Distribution Centre under construction in Melbourne’s industrial hub. The REIT also divested $79 million in assets, maintaining a disciplined approach to portfolio recycling and quality enhancement.
Capital management remains a priority, with $1.1 billion in new interest rate swaps executed to hedge exposure, targeting an 80% hedging level for the second half of FY26. The REIT’s balance sheet gearing stands at a conservative 29.8%, within its target range, and Moody’s reaffirmed its Baa1 credit rating with a stable outlook.
Sustainability and ESG Leadership
Charter Hall continues to integrate sustainability into its operations, maintaining Net Zero Scope 1 and 2 emissions and improving its GRESB score to 82 points. The REIT expanded its solar capacity to 9.4MW, with 98% of generated clean energy supplied directly to tenants. Social initiatives include significant community engagement and support for First Nations partnerships, reinforcing the REIT’s commitment to environmental, social, and governance (ESG) principles.
Outlook and Guidance
Looking ahead, Charter Hall Long WALE REIT reaffirmed its FY26 guidance, targeting operating EPS and DPS of 25.5 cents, representing 2% growth on FY25. The distribution yield is forecast at an attractive 6.8%, supported by stable rental income and active portfolio management. The REIT’s strategy to provide secure, predictable income through long-term leases to high-quality tenants remains firmly in place.
Bottom Line?
With a fortified balance sheet and resilient portfolio, Charter Hall Long WALE REIT is well positioned to navigate market uncertainties while delivering steady income growth.
Questions in the middle?
- How will rising interest rates impact Charter Hall’s cost of debt and future earnings?
- What are the prospects for further portfolio recycling and acquisitions in FY26?
- How might evolving ESG standards influence the REIT’s asset management and tenant relationships?
