GPT Group Provided An Update On Portfolio Valuation – A Quick Look

  • Dec 19, 2018 AEDT
  • Team Kalkine
GPT Group Provided An Update On Portfolio Valuation – A Quick Look

GPT Group (ASX: GPT) is into diversified business, which operates in various segments including retail, office, logistics, and development. The group is among one of the largest Australia’s diversified property groups. It also ranks among the top fifty company by market capitalization among the ASX listed companies. The company owns and manages offices, logistics, business parks and prime shopping centres across Australia which worth a total value of approximately $22.7 billion. 

The company is one of the most respected property firm among various groups including investors, customers, and several communities. The company has an objective to deliver superior returns to its investors and create a better environment for the customers and communities to prosper. The company thrives on values related to achieving the excellence in their work, taking initiatives to grow, working from diversified groups yet put the best outcome for the company, working with integrity and be open about various matters, and focus on the consistent delivery of performance in the present and future.

On 19 December 2018, the company announced a portfolio valuation update. The company has independently revalued its portfolio which it owns and manages, consisting of 62 properties.

The major contributor to the increase in portfolio valuation is listed below:

  • Significant increases during the half are noticed with the group’s Sydney office assets. The 2 Park Street property increased by 8.6 percent, and MLC Centre and Australia Square increased by 5.2 percent and 4.8 percent, respectively.
  • Melbourne Central retail continued to achieve strong sales growth as a result of the introduction of several new retailers during the year. The valuation however increased by 6.8 percent with the centre.
  • The entire Logistics portfolio was revalued during the period, with the portfolio delivering a Total Portfolio Return of approximately 15.7 percent in 2018 with the cap rate firming 40 basis points.

The revaluations have resulted in an approximate increase of $447.5 million value. It is equivalent to 25 cents per share. This represents a growth of 4.7% approximately of the company’s net tangible assets. Twenty-seven assets were revalued in the office segment whereas 7 and 28 assets have been revalued in retail and logistics space respectively. The overall valuation of the office segment stood at $221.0 million with logistics at $ 127.0 million and retail space at $99.5 million with a percentage change of 7.3% being highest for the logistics followed by 3.9% and 1.5% for office and retail segments.

The weighted average Cap rates used to revalue the portfolio is 4.95% for the office segment and 4.87% and 5.77% for the retail and logistics space, respectively. This represents a change of -7bps, -10bps and -40bps for the office, retail and logistics segments, respectively.

GPT’s Chief Executive Officer Bob Johnston said that the company has continued to see strong growth achieved by the office and logistics portfolio during the period and the office portfolio benefitted largely from its high exposure to the strongly performing Sydney and Melbourne markets.

Let us now quickly analyze the performance of GPT’s stock performance and the return it has generated over the past few months. The stock of GPT Group closed the session today on the negative note. The stock price of the company settled at A$5.515 per share which implies that the stock has fallen A$0.035 per share or 0.631%. The market capitalization of GPT Group stood at $10.02 Bn. The stock price of the company is trading towards the higher range. In the time span of previous one month, the stock delivered 4.91% return.


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