3Q24 overview:
- FY24 funds from operations (FFO) guidance range upgraded to 23.2 – 23.6 cents per security (cps), previously 22.5 to 23.1 cps
- Reaffirmed FY24 distribution guidance of 19.3 cps
- Stable weighted average lease expiry (WALE) of 5.7 years (31 December 2023: 5.8 years), portfolio occupancy of 95% unchanged from 31 December 2023
- Completed 7,294 square metres (sqm) of leasing across the portfolio, c.1% of portfolio income
- Extended several bank debt facilities totalling $320 million, c.15% of total facilities, on favourable terms
Timothy Collyer, Managing Director of Growthpoint, said, “Following better-than-expected office leasing during FY24, lease surrender fees and make good income, we are pleased to upgrade FFO guidance and reaffirm distribution guidance. The Group continues to proactively address vacancies and lease expiries across the portfolio with signed Heads of Agreement for a further 1.8% of portfolio income. Growthpoint’s quality metropolitan office portfolio is seeing a good level of tenant inquiry from Government and corporate tenants.
“The Group’s industrial portfolio is poised to benefit from rent reversion. Around 40% of leases expire between FY24- FY26 and are c.14% under-rented relative to market valuation rents. Industrial demand is anticipated to continue above long-term averages given population growth and demand from e-commerce. Rental growth is expected to remain positive due to constraints in land supply, planning challenges and the cost of construction. Vacancy rates remain very low on the eastern seaboard.
"The Group continues to enhance its capital management approach. Previously, the Group had $715 million of bank debt facilities maturing in FY27, following the extension of several debt facilities, this has now been reduced to $445 million. The Group also maintains $261 million of undrawn bank debt facilities”.
