This article is from the Australian Property Journal archive
MACQUARIE DDR Trust has successfully executed new leases in the December quarter, but the value of its portfolio has continued to decline.
As at December 31 2009, the trust’s total portfolio consisted of 49 core shopping centres and 31 ex-Mervyns sites covering a combined 13.4 million sqft, with a weighted leased rate of 80.9%.
During the period, 260,007 sqft of space, or 2.4% of the portfolio was leased. The weighted average rental decrease on new leases and renewals was 10.1%. Although rental rates on new leases are at lower levels than previous rents paid by prior tenants, the trust’s key focus remains on stabilising its leased rate and net operating income and to enhance the value of the portfolio.
The trust’s core shopping centre portfolio, which excludes the ex-Mervyns properties, comprises 11.0 million sqft and contributed 98.9% of annual base rent for the quarter. The portfolio was 89.0% leased at December 2009 and the weighted average lease term remained relatively stable at 5.1 years.
The Ex-Mervyns portfolio consists of 31 assets comprising 2.4 million sqft and remains 6.4% leased at December 2009.
CEO Luke Petherbridge said it is pleasing to attract new tenants resulting in an increase in the comparable leased rate for the shopping centre portfolio.
But the value of the trust’s portfolio decreased 1.6% to $US1.43 billion, down from $US1.45 billion as at June 2009. The movement in portfolio value is the result of a softening of the weighted average capitalisation rate from 8.6% at June 2009 to 8.9% at December 2009, offset somewhat by leasing success over the period.
Australian Property Journal
