This article is from the Australian Property Journal archive
CONTRACTED rent growth partially offset the impact of capitalisation rate expansion as nearly half of Dexus Convenience Retail REIT (DXC)’s portfolio of service and convenience stations saw a valuation fall of $8.7 million.
The fall, which equates to 1.1% in a loss of value, was across 45 of DXC’s 101 assets which were externally valued. The remainder are subject to internal valuations.
The weighted average capitalisation rate across the total portfolio expanded 20 basis points over the six months to the end of December, from 6.10% to 6.30%.
“The strength of contracted rent growth across high-quality tenant covenants continues to partially offset the impact of capitalisation rate expansion,” Jason Weate, DXC fund manager said.
“The portfolio average cap rate of 6.30% is well positioned in the current environment, remaining above the marginal cost of debt with broad-based appeal to direct property market investors.”
