Property firm on track despite softening sentiment

Highpoint shopping centreProperty firm GPT remains on track to meet its guidance after posting a strong September quarter.

GPT’s comparable specialty moving annual turnover1 (MAT) was up 0.6 per cent, with total centre MAT up 1.8 per cent. Specialty retail sales were $11,103 per square metre at 30 September, up 2.3 per cent compared to the previous comparable period.

During the period, the GPT Wholesale Shopping Centre Fund (GWSCF) settled its acquisition of an additional 25 per cent stake in the Highpoint Shopping Centre and Maribyrnong Homemaker Centre for $680 million (excluding acquisition costs of $37.4 million).

The purchase took GWSCF’s ownership of the centre to 83.33 per cent with GPT retaining a 16.67 per cent interest.

GWSCF revalued seven assets during the quarter, resulting in an increase in the value of the portfolio by $89.3 million. GWSCF’s weighted average capitalisation rate firmed by 30 basis points to 5.01 per cent. Following the end of the quarter, the GWSCF-owned Wollongong Central opened the $68 million refurbishment of its Gateway Building which included the new generation David Jones department store and food concept.

“The Group’s balance sheet was strengthened during the quarter following the successful US Private Placement which was oversubscribed and enabled GPT to significantly extend its debt maturity profile,”said GPT CEO and MD Bob Johnston.”

“Retail sales growth softened during the quarter with total centre MAT growth falling from 3.1 per cent in June to 1.8 per cent as at the end of September reflecting a softening in consumer confidence.

“Despite this, GPT’s high quality retail portfolio continues to deliver strong like for like income growth.”

“The group remains well positioned to deliver the full year 2017 guidance of 3 per cent FFO per security growth announced with the interim results in August.”

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