The country’s biggest office landlord, Dexus, has upgraded its full-year earnings guidance as record-low vacancy rates and strong demand across its office and industrial property assets boost rents.
The company’s first-half result was bolstered by new leasing activity at its tower at 80 Collins Street in Melbourne and the signing of retailers, including luxury retail brand Valentino, to the upgraded MLC Centre in Sydney.
The group reported an adjusted funds from operations, the most accurate measure of performance for real estate investment trusts, of $295.3 million for the six months to December 31, a rise of 4.7 per cent over the same period last year. The group upgraded its forecast of distribution-per-security growth from 5 per cent to 5.5 per cent for the 12 months to June 30.
Analysts said the result was in line with market expectations and expect improved earnings from ongoing developments in Melbourne, Sydney’s Circular Quay and Brisbane’s waterfront. Dexus’ funds management business also grew with the addition of the new healthcare funds.