This article is from the Australian Property Journal archive
DIVERSIFIED property group Stockland saw month-on-month improvement in sales and enquiries at its master-planned communities (MPC) in the September quarter, and maintained its full-year settlement target of 5,200 to 5,600 settlements.
In its quarterly update, Stockland said it netted 991 sales and ended the period with 4,772 contracts on hand, and expects a slightly larger settlement and funds from operations skew to the second half of FY24 than in FY23.
Average settlement pricing is expected to be 5% to 10% higher than FY23, and the development operating profit margin to be in the low 20% range, in line with previous guidance.
“Underlying demand for our MPC product is solid, and we remain positive on the medium-term residential outlook, with the rebound in net overseas migration supporting demand amidst ongoing constrained land supply. However, we expect sales volumes to remain around the levels we’ve seen over the last few quarters until the interest rate environment has stabilised,” managing director and CEO Tarun Gupta said at the company’s annual general meeting yesterday.
Stockland maintained its FY24 FFO per security guidance range of 34.5 to 35.5c on a pre-tax basis.
Its town centres portfolio delivered comparable total sales growth of 7.6%, which Gupta owed to the skew towards essential-based categories against the backdrop of increasing cost-of-living pressures.
Comparable specialty sales growth was 5.2% on a moving annual turnover basis.
Gupta said net sales in the land lease communities segment of 111 homes and improved enquiries over the quarter demonstrated “sustained demand” for land lease product.
Stockland has a $6.4 billion logistics development pipeline, with construction expected to commence on majority of the $1.1 billion of active developments over FY24.
Construction is progressing on stage one of M_Park in NSW, in partnership with Ivanhoé Cambridge, with the first building completed and the second building expected to complete in this half. Construction of the final two buildings has commenced.
Gearing levels are expected to increase by December due to ongoing capital deployment and significant second-half skew in master-planned communities settlements, but remain within 20% to 30% target range.
