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Precinct Properties profit up 12pc

NZN 15/02/2017 Sophie Boot

Listed commercial property developer Precinct Properties New Zealand has lifted first-half profit 12 per cent as its overall occupancy rate rose to 99 per cent.

Net profit rose to $39.1 million in the six months ended December 31, from $34.8m a year earlier, the Auckland-based company said on Thursday.

It maintained its earnings guidance of 6.2 cents per share over the year, and annual dividend guidance for 5.6 cents, declaring a 2.8 cent interim dividend.

The investor announced law firm DLA Piper has leased 2700 square metres of its Commercial Bay development in Auckland, taking it to 64 per cent pre-leasing based on income, from 52 per cent in December. The $681m development in downtown Auckland will include a 39-storey waterfront office tower and retail centre.

The company said interest remains strong and it expects more lease success in 2017 now it has unconditionally acquired Queen Elizabeth Square from Auckland Council.

Overall portfolio occupancy rose to 99 per cent in the first half from 98 per cent a year earlier, while the weighted average lease term dropped to 5.9 years, from 6.3 years in June 2016.

Precinct will buy 50 per cent of Generator, which operates 3000 square metres of co-working space in Auckland's Britomart. The acquisition will help the company expand its traditional client base into smaller businesses, helping to grow occupancy and demand, it said.

The company booked a $12m devaluation on Wellington's Deloitte House in Wellington to $33.4m following the Kaikoura earthquakes.

The shares last traded at $1.235, and have gained 6.9 per cent in the past 12 months.

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