"A $248.2m fair value gain on investment properties, as compared to a $7.8m fair value loss in the prior interim period, was the main contributor to the company's record interim profit," PFI said today.
"A $7.9m write up of the company's Carlaw Park properties to the contracted sale price of $110m brings total fair value gains on properties to $248.2m for the interim period."
Around 90 per cent of the revaluation rises were due to movements in yields or cap rates.
"As a result of portfolio and valuation activity, PFI's passing yield firmed from 5.53 per cent to 4.75 per cent. An independent market rental assessment of the entire portfolio was completed as part of the valuation process, this assessment estimates that PFI's portfolio is around 3 per cent under-rented," the company said.
Net rental income of $45.9m was up $4.3m or 10.4 per cent on the prior interim period, with positive leasing activity and acquisitions contributing $2.6m each to this increase.
The interim result was a record for the business.
In April, the company refinanced a $100m loan with a seven-year $125m term loan from the Commonwealth Bank of Australia. Last month, its $300m syndicated bank facility was refinanced and increased by a further $100m with a two-year loan facility from the BNZ.
Rent reviews were completed on 66 leases in the latest half-year, resulting in an average annual uplift of 3.1 per cent on about $32.6m of contract rent.
Six market rent reviews on about $2.6m of contract rent delivered an annualised increase of 1.9 per cent over an average review period of 5.7 years.
In January, PFI bought 670-680 Rosebank Rd, Avondale for $39m. It already owned neighbouring industrial properties on Rosebank Rd and Patiki Rd and when combined with these sites, an industrial estate of 8.6ha worth about $125m was created.
Shares are trading around $2.93, up 17 per cent annually.
