We Initiate Coverage on Charter Hall Social Infrastructure REIT With AUD 3.70 FVE and No-Moat Rating

Charter Hall Social Infrastructure REIT is a reincarnation of Folkestone Education Trust, following Charter Hall Group’s acquisition of Folkestone, a smaller property fund manager, in 2019. From a pure play childcare property trust, Charter Hall Social has expanded into other social infrastructure sectors, such as higher education, healthcare, transport and government services. This strategic movement diversifies Charter Hall Social’s income streams. As of June 30, 2025, around 70% of earnings are generated from childcare, versus 80% three years prior. Portfolio diversification is likely to be an ongoing strategy. We expect the weighting of childcare to continue declining to about half of the property portfolio over the next decade.