This article is from the Australian Property Journal archive
SALES and leasing spreads across GPT Group’s retail portfolio showed further signs of recovery in the March quarter, although Melbourne Central is lagging its peers as CBDs await a more earnest recovery.
In its quarterly update, GPT reaffirmed its full-year funds from operations guidance of in the range of 31.7 to 32.4c per security and distributions of 25.0c per security.
Specialty leasing spreads across the 231 deals in the period improved from -8.5% in the December quarter to -5.0%.
Total centre sales for the quarter were up 4.6% over the period, with February up 10.2% and March up 8.7% in annual terms as the Omicron wave subsided. Specialty sales productivity was up 8.4% to $9,181 per sqm.
Excluding Melbourne Central, portfolio retail sales were up 11.9% on 2019. The CBD centre did however see visitation up 17% and sales up 22% on the prior corresponding period, while Highpoint Shopping Centre, in the western suburbs, record total specialty sales growth of 7.6%.
Cash collections have improved steadily throughout calendar 2022, from 81% during the Omicron peak in January to 87% in February, 97% in March and 110% in April.
During the period it completed the $397 million sale of Casuarina Square in Darwin to Sentinel Property Group.
GPT said office leasing markets “remain challenging” with negative net absorption recorded in the March quarter, however total market vacancy rates improved across Sydney, Melbourne and Brisbane CBDs as a result of reduced sub-lease vacancy and withdrawals.
Its office portfolio saw occupancy dip to 92.0% with a weighted average lease expiry of 4.9 years. During the quarter, 7,800 sqm of leases were signed and 12,100 sqm of terms agreed.
“While office leasing enquiry was relatively muted during the first quarter, it is expected that activity levels will increase as people once again return to the workplace,” it said.
“There is an increasing preference from tenants to be accommodated in buildings with leading sustainability credentials and GPT remains on track to have all operational office assets certified as operating carbon neutral by 2024.”
There was 75,000 sqm of leases signed across its logistics portfolio with a further 18,600 sqm agreed, maintaining a 6.3-year WALE, although occupancy was down to 97.5%.
It has four industrial developments totalling 76,600 sqm of gross lettable area underway in Melbourne and Brisbane, with 62% leased or under heads of agreement.
