Property firms share optimistic outlook

Property groups covering the office, retail and industrial sectors say market conditions are improving.

Owners of shopping centres, factories and office towers expect improving property market conditions to continue.

Dexus Property Group, the owner of $7.6 billion in office properties, says values are on the rise.

"Over the next 12 months, lead indicators are pointing to improving office market conditions, including increased business confidence in response to low interest rates, a strengthening in employment growth and a continued migration of tenants to CBD markets," chief executive Darren Steinberg said in a statement.

"International and domestic investment demand remains strong for Australian property across all sectors, positively impacting valuations and creating opportunities to broaden third-party capital partnerships."

The company has upgraded its financial guidance for the 2013/14 financial year after recently completing a takeover of the Commonwealth Property Office Fund (CPA) with Canada Pension Plan Investment Board.

Dexus expects funds from operations to increase to 8.34 cents per security, up 0.6 per cent on its prior guidance, and up 7.6 per cent on the 2012/13 financial year.

Its distributions to security holders are expected to rise to 6.26 cents per security.

Another property firm, GPT Group, said there had been encouraging improvements in retail and office market conditions in the three months to the end of March.

Chief executive Michael Cameron said GPT had achieved significant growth in its logistics development business, expanded funds under management, and maintained a "fortress" balance sheet.

Sales in its shopping centres over the last nine months had shown positive momentum, and further moderate growth is expected in sales and rents in the medium term, he said.

Goodman Group, which owns properties around the globe, said it was benefiting from the strength of international capital markets, and also said the outlook remained positive.

"The robust property fundamentals and strong contribution from Goodman's development and management businesses in the third quarter of FY2014 ensures Goodman is well positioned to meet its growth expectations in current and future periods," chief executive Greg Goodman said.

At 1150 AEST, Dexus securities were down 1.25 cents at $1.0825, GPT Group was down four cents at $3.85 and Goodman Group was six cents lower at $4.90.


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Source: AAP


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