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Investec’s Australian property fund hits 99.9% occupancy rate

Oct 30 2019 11:08

The Investec Australia Property Fund [JSE: IAP] reported a decline in headline earnings for the six months to end-September despite all its properties being almost fully let.

The fund now owns 31 office buildings and industrial properties in Australia and New Zealand, valued at AUD1.18 billion (R11.8bn).

Only 368m² remains vacant across the entire portfolio of 343,000m², which means its occupancy rate has improved from 99.4% at end-March to 99.9%. In South Africa, Growthpoint [JSE:GRT], SA’s largest listed property company, last month reported a 26% increase in local vacancies - from 5.4% of its gross leasable area (GLA) to 6.8%.

More than 54% of the fund’s leases now expire after five years, providing long term visibility of income for investors, IAP CEO Graeme Katz said.

It declared an interim distribution of 3.20 Australian cents per unit (pre-withholding tax) and expects it will deliver 8.88 Australian cents for the full year.

The share’s underlying net asset value increased to AUD1.33 per unit, up from AUD1.30, but its headline earnings fell from AUD25.570m to AUD22m.

The JSE-listed fund made its debut on the Australian stock exchange earlier this year, and raised AUD161m.

“We are very pleased with the support we have received from both institutional and retail investors in Australia, and the continued support from our existing investor base in South Africa,” Katz said.  

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