Strong valuation gains across the group’s $3.86 billion portfolio saw its book value increase by $163.4 million, equating to a 4.9 per cent boost on a like-for-like basis.
“We are exposed to office and industrial sectors,” Mr Collyer said. “Our position in those two markets, at this point in the cycle, is definitely paying off.”
Yield compression and improving market rents were driving up values, with gains strongest in NSW and Victoria, he said.
Construction of the group’s two large office buildings at Botanicca Corporate Office Park in Melbourne’s Richmond was under way and expected to be finished in the first half of 2020.
The fund manager’s offices are now valued at $2.7 billion.
It funded the $57 million expansion of Woolworths’ South Australian distribution centre at Gepps Cross receiving, in return, a coupon for incurred project costs at a yield of 6.75 per cent. When complete, Woolworths’ lease will reset to 15 years.
The company is on track to meet its upgraded full-year guidance. It will hand unit holders an interim 11.4¢ distribution on 28 February, a lift of 3.6 per cent.
Growthpoint spent $548 million on acquisitions, developments and expansions over the half year. Appetite for Australian commercial property remains high from both local and offshore investors, Mr Collyer said.
He forecast “reasonable rental growth” in Sydney and Melbourne’s industrial markets, but was slightly more cautious on the economy. “There is a little bit more uncertainty in economy in general than there was six months ago.”