Malls boost big landlord's latest annual revaluations

One of New Zealand's biggest landlords has just booked a $179 million portfolio uplift hitting $2.7 billion and that's mainly due to its big mall presence.

NZX listed Kiwi Property, now fitting out new premises for the world's two biggest global fashion clothing retailers H&M and Zara at its Sylvia Park mall, says the value of its property is up 7 per cent.

The valuation is for the year ended March 31.

Chris Gudgeon, Kiwi chief executive, said the value of the retail portfolio rose the most - up $114 million.


"Sylvia Park set another record valuation, rising 11% to $704.0 million (after allowances for costs to complete on current development works), assisted by securing New Zealand's first retail stores for international fashion giants Zara and H&M at that centre. Sylvia Park's capitalisation rate compressed by 25 basis points to 6 per cent, the firmest rate of any regional shopping centre in New Zealand," a statement from Kiwi said.

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"At North City in Porirua, our acquisition of the freehold interest in the land, previously leased from council, together with positive sales growth and leasing activity, led to its value increasing by 10 per cent to $109.5 million.

"Positive movements were also recorded at Northlands (+9 per cent), LynnMall (+6 per cent), Sylvia Park Lifestyle (+3 per cent), The Plaza (+2 per cent) and the newly acquired Westgate Lifestyle (+2 per cent).

"Centre Place North recorded a 5 per cent decline in its value to $65.5 million, with positive recent retail sales growth not yet sufficient to offset a more moderate outlook for rental growth," the statement said.

Gudgeon said the strong revaluation outcome reflected the quality of the portfolio and an intensive asset management approach to driving income and investment performance.
"Our value uplift also reflects strong investor demand for property, from both domestic and offshore investors, underpinned by economic growth and low interest rates," Gudgeon said.

"Firming capitalisation rates have been a common factor, driving approximately half of the value growth across our portfolio. Our development projects have also added value as have successful leasing outcomes, positive retail sales growth and high occupancy rates." Gudgeon said.