HPI provides investors with:
- An attractive annualised Distribution Yield underpinned by long term leases with strong contracted income growth;
- Exposure to the attractive Pub real estate sector and potential capital growth of the properties in the Portfolio; and
- Additional growth potential through the acquisition of assets that meet HPI's investment criteria
High quality Portfolio predominantly leased to the Coles group and to Australian Leisure & Hospitality, a joint venture 75% owned by the Woolworths group:
- The Portfolio comprises Pubs and On-site Specialty Stores located throughout Queensland and South Australia.
- The pub tenants provide approximately 95% of HPI’s rental income. The remaining rental income is derived from the Specialty Tenants leasing the On-site Specialty Stores including franchisors and franchisees of 7-Eleven, Nightowl, Nando’s, Subway, Noodle Box and The Good Guys.
Longstanding relationship with Coles underpinned by the strategic value of liquor licences:
- In Queensland, the holder of a commercial hotel licence may sell packaged liquor for off premise consumption from the hotel site or from bottle shops detached from the main hotel premises.
- Coles operates pubs in Queensland which permit it to sell packaged liquor.
- All of the Pubs and detached bottled shops in HPI’s Portfolio are leased to subsidiaries of Coles except for one Pub which is leased to Australian Leisure and Hospitality.
Stable income stream generated by long term lease profile with attractive terms:
- Under the Leases, the tenants have options to extend the lease period for up to 30 years depending on the individual lease.
- HPI retains the rights over the liquor and gaming licences in respect of a majority of the Pubs.
- In the majority of cases, the original gaming authorities associated with the Pubs revert to HPI typically at the end of the lease term. In addition, HPI typically has the option to purchase any additional gaming licences used in respect of the Pubs.
Strong organic income growth and additional future growth opportunities:
- Strong rental income growth generated with a majority of the Leases containing minimum rental increases of the lower of 2 times the average 5 year historical CPI and 4% per annum.