Listed property investment firm Goodman Property Trust has delivered another strong full year result, bolstered by rising commercial property values, and demand for its industrial spaces.
Positive demand was reflected in an increased level of development activity, with five new projects commencing in the last 12 months, Goodman said. Photo:
Key numbers for the 12 months ended March compared to a year ago:
- Net profit $748.6m vs $631.7m
- Property income $157.1m vs $153m
- Property value gains $660.4m vs $560m
- Value portfolio $4.8b vs $3.8b
The company's net profit increased by 18.5 percent for the year ended March, with operating earnings rising by 3 percent.
"The underlying strength of our operating results has reinforced the value of an investment strategy focused on urban logistics in the Auckland industrial market," Goodman chair Keith Smith said.
The company said its portfolio was effectively at capacity, with average occupancy at 99.4 percent.
Chief executive John Dakin said the pandemic had accelerated key structural changes driving demand for urban logistics space.
Goodman said it had also benefited from the digital economy which had grown since the pandemic began.
"The expansion in e-commerce is a positive trend for the trust with customers extending their business operations to incorporate the growth in online retail," Dakin said.
"The strength of the current leasing market reflects a growing digital economy and while the longer-term economic impacts of Covid-19 are uncertain, the majority of our customers have adapted to the new operating environment," he said.
Goodman said positive demand was also reflected in an increased level of development activity, with five new projects commencing in the last 12 months.
"While the pandemic and other downside risks are likely to constrain economic activity over the short to medium term, the quality and scale of the portfolio, together with low gearing and a focused investment strategy, give us confidence about the year ahead," Dakin said.
Goodman said the demand for space was also reflected in the $300 million worth of new development projects announced during the year, the largest being a facility for Mainfreight in Māngere and a parcel processing facility for NZ Post in Albany.
The company forecast a 4 percent increase in cash earnings for 2023, with a 7 percent increase in cash distributions.
"Recognising that the world is changing rapidly, and that today's economic outlook is more uncertain than 12 months ago, our guidance is subject to there being no material adverse changes in market conditions or other unforeseen events," Smith said.