- Centurion announced its entry into Australia’s Purpose-Built Workers’ Accommodation (PBWA) industry via its A$45m (S$41m) acquisition of Velocity Village and Velocity Motel & Bistro in Karratha, Western Australia. The purchase price was validated by an independent CBRE valuation concluding the same A$45m market value.
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Small EPS accretion.
- According to Centurion, pro forma EPS accretion, assuming deal completion was on 1 Jan 25, was approximately 5% for 2025 which we view as modest but meaningful for a deal representing just 3% of market capitalisation.
- In addition, we view the implied 2025 P/E acquisition multiple of 7.1x as conservative relative to Centurion’s existing asset base and its 2027E P/E of 10.9x.
Logical extension of a strong business segment.
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- The structural similarities are compelling as the Australian and Singaporean PBWAs are asset-heavy, operationally intensive, have long-duration demand driven by institutional rather than retail clients, and will likely be injected into Centurion Accommodation REIT (SGX:8C8U) over time.
The Pilbara macro backdrop provides a structurally durable demand floor.
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