Growthpoint upgrades FY23 guidance, confirms distribution for 1H23 and provides preliminary draft portfolio valuations
Growthpoint Properties Australia (Growthpoint, or the Group) is pleased to announce:
- FY23 funds from operations (FFO) guidance upgraded to 25.5 to 26.5 cents per security (cps), previously 25.0 to 26.0 cps
- Distribution of 10.7 cps for the six months ending 31 December 2022
- Preliminary draft external valuations indicate a decrease of $143.6 million1 which is expected to result in a reduction of approximately 19 cps to the Group’s net tangible assets (NTA)
Timothy Collyer, Managing Director of Growthpoint, said, “We are pleased to upgrade our FY23 FFO guidance today to 25.5 to 26.5 cps and announce our distribution of 10.7 cps for the six months to 31 December 2022, which reflects positive leasing activity and increased visibility of interest costs for the Group over FY23.
“The Group’s movement in preliminary draft external valuations reflect the increased cost of capital and demand for higher return hurdle rates from investors in commercial property markets. Pleasingly, conditions within the office and industrial occupier markets remain generally positive. In the industrial market there is strong rent growth which is largely offsetting yield expansion. Office markets continue to see positive net absorption and increasing physical occupancy, with companies recognising the importance and quality of their office spaces to support collaboration and new ways of working.
“Growthpoint remains well positioned to continue to manage through the current period of macroeconomic volatility with higher inflation, central bank rate rises and higher interest costs. The Group’s exposure to favoured industrial and metropolitan office property markets and secure income from predominantly large corporate and government tenants continues to provide a resilient foundation to our business.”