This article is from the Australian Property Journal archive
DESPITE subdued leasing conditions in its office portfolio, momentum across retail and logistics portfolios supported GPT.
GPT’s retail portfolio for the quarter ended 30 September 2022 has seen strong leasing activity, with 95 deals completed and specialty leasing spreads improving to -2.9% from -4.9% in the six months to June 2022.
Specialty leasing deals saw fixed base rents with annual average increases of 4.5% and an average lease term of 4.6%.
Retail portfolio occupancy also saw marginal improvement over the quarter, up from 99.3% to 99.4%.
Total centre quarterly sales across the retail portfolio were up 8.9% and total specialty sales up 11.2%, compared to the same quarter in 2019.
“We have seen ongoing momentum across GPT’s Retail portfolio this year, with Specialty sales now exceeding $11,500 per square metre and portfolio leasing metrics continuing to strengthen,” said Bob Johnston, CEO at GPT.
“While rising interest rates and inflationary pressures are expected to begin to impact consumer spending, GPT’s high quality portfolio is well positioned with strong sales productivity and high occupancy.”
GPT’s office portfolio saw largely unchanged subdued leasing activity over the quarter, with 27,00sqm of in total leasing since June.
This brings total leasing in the office portfolio, including heads of agreement, to 79,600sqm for the calendar year to 31 October.
Incentives also continued to be elevated for the quarter, at an approximate average of 35% for deals completed.
As at 30 September 2022, office portfolio occupancy was at 91.6%, down slightly from 92.0% in the previous quarter. While portfolio WALE was steady at 4.7 years.
“Office lease enquiry improved over the quarter, although leasing conditions remain subdued with elevated market vacancy and larger occupiers continuing to evaluate future space requirements,” added Johnston.
“High quality, sustainable buildings with distinctive spaces continue to be sought out by customers and the rollout of GPT’s turnkey Premium Suite offering has been well supported by smaller tenants.”
The logistics portfolio was supported by strong market fundamentals, with 45,300sqm of total leasing has been achieved over the quarter.
This took total taking total leasing volume for the calendar year to 31 October 2022, including HoA, to 273,300sqm.
Logistics occupancy was 98.4% at 30 September 2022, down marginally from 98.7%, with a WALE of 6.3 years.
“Our logistics portfolio is delivering strong results with robust levels of tenant enquiry and market vacancy rates at historic lows. We are making excellent progress in developing out our pipeline, with five Logistics projects scheduled to complete over the next 12 months,” said Johnston.
GPT reaffirmed its guidance to deliver 2022 funds from operations of approximately 32.4 cents per security and a distribution of 25.0 cents per security for the full year.
