In the second of two roundtables exploring corporate sectors on the front line of the COVID-19 crisis, in November 2020 KangaNews and Westpac Institutional Bank hosted issuers and analysts from the Australian REIT sector to talk about pandemic fallout. The conversation covered crisis response and the new shape of the sector in future, including the likely impact on individual property categories.
While true corporate deals in the Australian market last year did not reach the heights of 2017, a second-half resurgence brought record volume from triple-B issuers and hints that extended duration is on the cards once more. The question is whether the corporate space will continue to grow in 2020 or lose momentum as it did in 2018.
Dexus Finance (Dexus) printed the largest Australian dollar true corporate deal at 12-year tenor on 23 January. Deal sources say a cornerstone investor enabled the issuer to launch confident of securing competitive pricing and liquidity at the extended duration.
On 22 January, Dexus Finance (Dexus) (A-/A3) launched a new 12-year, Australian dollar denominated, benchmark transaction. Indicative price guidance for the forthcoming deal, which is expected to price on the day after launch, is 185 basis points area over semi-quarterly swap. Westpac Institutional Bank is leading.
The domestic bond market has supported a steady flow of 10-year corporate deals in recent months. Dexus Finance (Dexus) is the latest corporate to have issued at this tenor domestically and the issuer says the ability consistently to price deals at the long end shifts its appetite for domestic-market deals significantly.