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Charter Hall Funds Management Limited has invited investor participation in its new 130 Stirling Street Trust. Under this offer, Charter Hall is seeking to raise up to $40.6 million to purchase the recently completed office on the fringe of Perth’s CBD.

The group is offering ordinary units in the unlisted property trust at an issue price of $1.00 per Ordinary Unit with a minimum $10,000 investment per investor.

Charter Hall manages core plus and opportunistic real estate strategies in Australia, with $3.2 billion in assets under management, diversified across five wholesale unlisted property funds, two diversified retail unlisted property funds and six closed-end syndicates.

The group said it selected the Stirling Street Property for its 7th closed-end syndicate specifically due to the tenant covenant profile, 100% leased status, long weighted average lease expiry of 8.9 years and solid fixed rental increases averaging 4.3% per annum.

“Charter Hall considers the 130 Stirling Street Property to be one of the highest quality office buildings constructed outside the Perth CBD core and, importantly, believes an investment in the Trust will give unit holders exposure to Perth’s strong economic growth forecasts,” the group said.

The 130 Stirling Street Property will be purchased for $71.6 million, which is equal to the independent valuation, equating to a capitalisation rate of 8.5% and an 18% discount to the independent valuation as assessed in September 2008.

“The relatively high capitalisation rate and minimal transaction costs give the Trust substantial opportunity to deliver capital growth to Unitholders in addition to a solid distribution yield,” the groups said.

The group said unit holders would also benefit from stable and reliable tax advantaged income returns with strong distribution yield growth.

“The Trust will distribute monthly cash distributions, forecast to reflect an 8.3% yield over the first year and, with the benefit of fixed rental annual increases, growing to a forecast 9.0% yield for the second year,” Charter Hall said.

The offer opens on 12 November 2009 and is slated to close on 18 February or when the maximum offer amount is raised, whichever is earlier.

You can download the prospectus here.