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Folkestone Education Trust (FET) is a REIT that owns a portfolio of over 350 childcare centres around Australia

Tim Hannon

Newgate Capital Partners

Folkestone Education Trust (FET) is a REIT that owns a portfolio of over 350 childcare centres around Australia. We like the stock given its low risk earnings stream, long lease expiry profile, ability to develop assets on balance sheet and the opportunity for value creating acquisitions. The recent proposed merger with Folkestone Social Infrastructure Trust will add a further 47 childcare centres to the portfolio, deliver mild distribution accretion and see the FET market capitalisation lift to ~ $500 million, which should deliver a modest liquidity rerate. At current prices FET is delivering an attractive 2015 distribution yield of ~ 6.9% and should be able to deliver distribution growth at least at inflation over the medium to long term. Disclosure: Freehold owns FET across portfolios


Tim Hannon
Tim Hannon
Principal
Newgate Capital Partners

Tim has 22 years’ experience in the investment and securities markets. Tim was a partner of Goldman Sachs JBWere and during his 15-year tenure at the firm had senior experience across all areas of equities investing. Tim was Head of Australian...

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