PFI, APL, KPG, PCT: 4 REITs in focus as buyer expectations fall

Be the First to Comment Read

PFI, APL, KPG, PCT: 4 REITs in focus as buyer expectations fall

 PFI, APL, KPG, PCT: 4 REITs in focus as buyer expectations fall
Image source: kwarkot, Shutterstock.com

Highlights

  • There has been a noticeable drop in a buyer’s expectations after a rise in NZ house prices.
  • APL notified on Monday that it had sold a property in Kamo, Whangarei, for $2.7 million.
  • KPG is due to pay a final cash dividend of 2.85cps for the 6 months ended 31 March 2022 on 22 June 2022.

House prices in New Zealand fell at a faster rate last month with prices dropping 4% month-on-month compared to 1.7% a month before.

Apart from a decline in house prices and sales activity, there has been a noticeable drop in a buyer’s expectations. The latest ASB Housing survey has shown falling buyer expectations with only 11% of Kiwis expecting house prices to rise in the next 12 months, down from 49% in previous quarter.

However, net expectations have stayed largely positive with the April survey showing some bounce.

Source: © Alexandersikov | Megapixl.com

Amid this backdrop, let’s look at the performance of these 4 NZX REITs.

Property for Industry Limited (NZX:PFI)

Specialising in industrial property, PFI announced a share buyback program on 25 May. Under the program, PFI plans to repurchase up to 25,173,940 shares at the current market price equating to $60 million and the program will run up to 12 months from 25 May.

PFI notified on 20 June that it had acquired 39,423 shares on 17 June at $2.3232.

ALSO READ: FBU, IFT: Infra stocks in focus as Fletcher decides to boost Gib production

The Group does not expect any major change in valuations in its upcoming half-year results. PFI expects a dividend of 8.1cps in 2022. It also continues to assess investment opportunities.

On 20 June, at the time of writing, PFI was trading at $2.345, down 0.64%.

Asset Plus Limited (NZX:APL

Involved in property-related activities, APL notified on Monday that it had sold a property in Kamo, Whangarei, for $2.7 million.

DO READ: PFI, SPG, NZL: Property stocks in focus amid falling NZ house prices

The completion of the same is likely to happen on 30 November 2022. Net proceeds of the sale are likely to be used towards debt repayment. The Group also approved the sale of 35 Graham Street this month for $65 million to Mansons TCLM Limited.

On 20 June, at the time of writing, APL was trading at $0.255, up 2%.

Kiwi Property Group Limited (NZX:KPG)

A leading property investment company across NZ, KPG, registered solid results in FY22 with a 14% rise in NPAT and a 7.3% rise in operating profit before tax. The Group’s office assets witnessed a valuation uplift of 3.8% and delivered robust rental growth in the period.

Also Read: PCT, PFI GMT, KPG, ARG: 5 stocks to watch as housing market turns into buyers’ market

KPG plans to generate value for shareholders in FY23 and beyond. KPG is due to pay a final cash dividend of 2.85cps on 22 June 2022.

On 20 June, at the time of writing, KPG was trading at $0.965, down 1.03%.

Precinct Properties New Zealand Limited (NZX:PCT)

Precinct released its quarterly report for June 2022. The Group portfolio value stood at $3.1 billion as of 31 March 2022 with overall occupancy at 98%. PCT began the provisional establishment of a new strategic investment collaboration with the Singapore sovereign wealth fund GIC in February.

PCT expects an FY22 dividend of 6.7cps.

On 20 June, at the time of writing, PCT was trading at $1.3, down 1.89%.

Bottom Line

NZ house prices are expected to decline by over 10% by the end of 2022, as per market reports. The market has already begun to price in large interest rate hikes likely to be pursued by the RBNZ to contain inflation.

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)

Disclaimer

Speak your Mind

Featured Articles

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK