The country's biggest listed property investor has reported a sharp fall in profit as property value gains have eased.
The Base shopping centre in Hamilton, part of Kiwi Property's portfolio. Photo: Supplied
Kiwi Property's full year net profit is down 43 percent to $143 million in the year ended March, reflecting a much smaller valuation gain of $41m, compared with last year's gain of $175.9m.
"While the property sector is currently strong, we do expect the high level of value growth we have witnessed in recent years for investment grade real estate to begin to moderate as interest rates continue to rise from historic lows," said Kiwi Property chair Mark Ford.
The company's assets grew by 11 percent to $3 billion, while underlying profit, which excludes the valuation gains, rose 13 percent to a record $102.8m.
However, revenue was down by more than a quarter to $290.6m, as the company looked to increase the number of properties it managed on behalf of others.
"The company continues to diversify its revenue base, growing third party assets under management to approximately $400m," said chief executive Chris Gudgeon.
The company has three large development projects under way, which include an office building, dining lane and new carpark building at the massive Sylvia Park shopping centre in Auckland.
It has also added Hamilton's The Base and Centre Place-South to its portfolio.
Retail sales were up across Kiwi's shopping centres, with total annual retail sales up 5.8 percent to $1.7bn, compared with last year's growth of 2.3 percent on a like-for-like basis.
"New Zealanders retain a keen eye for value but are shopping with confidence," said Mr Gudgeon.
Kiwi will pay a full-year dividend of 6.75 cents per share, with a continued strong underlying performance expected to increase next year's payout to 6.85 cents.
