Arena REIT Says Edge Sales Cover Last Seven Arena Centres

Arena REIT (ASX:ARF) updated investors after the administrator of its tenant Edge Early Learning agreed sale terms for more centre businesses, including the last seven Edge-operated centres on Arena-owned properties.

The Administrator has entered into binding agreements or term sheets with six parties for the sale of a further 22 Edge early learning centre businesses. For the seven centres on Arena-owned properties, Arena has engaged with the Administrator on four proposed tenants: Montessori Academy at two SA centres and three experienced operators across the remaining five QLD properties. Arena is undertaking due diligence as it considers consenting to the assignment of those leases. Rent is currently being received on all 27 Arena-owned centres occupied by Edge while these transactions and the proposed Goodstart Early Learning transaction announced on 7 October proceed. Of the four Edge centres currently controlled by Arena, one has executed lease documentation and two have signed term sheets with Montessori Academy. Arena holds a bank guarantee and security deposits of approximately $4 million as security over the Edge leases and reserves all legal rights over the portfolio.

The transactions remain subject to confirmatory due diligence, final sale documentation, transfer of service approvals and lease assignment, and the agreements on Arena-controlled centres need regulator approval. The release gives no rent terms for incoming tenants and does not state arrangements for the fourth Arena-controlled centre.