The GPT Group has announced its results for the six months to 30 June 2022, delivering a solid result in the half, despite the ongoing impacts of the pandemic and the uncertain economic environment driven by high inflation and rising interest rates.
All three business segments (Retail, Office and Logistics) reported increased Funds From Operations on the prior corresponding period. GPT’s Retail portfolio recorded a net revaluation uplift of $97.3 million or 1.8% in the six months to 30 June 2022.
UniSuper has selected GPT to manage its $2.8 billion direct real estate mandate, with management to commence in September 2022. Assets include Karrinyup Shopping Centre (WA), Marrickville Metro (NSW), Dapto Mall (NSW) and Malvern Central (VIC), giving GPT the opportunity to grow its retail assets under management to more than $10 billion.
Melbourne Central continues to have strong demand from retailers and remains one of the country’s leading retail destinations. Driven by solid growth in the general retail, leisure and dining categories, in the month of June 2022 Melbourne Central traded at 91.4% of 2019 levels.
GPT’s Chief Executive Officer, Bob Johnston, said: “Notwithstanding the effects of COVID-19, our Retail portfolio continued to perform well with retail sales recovering to levels above 2019 pre-pandemic levels across most of our assets. Strong leasing outcomes have resulted in retaining high portfolio occupancy and leasing spreads continued to improve. Melbourne Central is benefiting from a return of students and tourists and there is a gradual return of CBD workers resulting in sales across most categories being close to pre-pandemic levels in the month of June.”
The performance of Melbourne Central is benefiting from the progressive return of office workers, students and tourists to the Melbourne CBD
Retail portfolio occupancy was 99.3% at 30 June 2022, with strong leasing activity resulting in 405 lease deals being achieved during the half with more than 76 new brands opening for the first time in a GPT centre. Deals completed had an average annual rental increase of 4.4% and an average lease term of 4.6 years.
Total Centre sales were up 11.5% and Total Specialty sales were up 11.6% for the six months to 30 June 2022, compared to the same period in 2021.
For the June 2022 quarter, Total Centre sales were up 18.0% and Total Specialty sales were up 18.8%, compared to the June 2021 quarter. Specialty sales productivity for the portfolio was $9,593 per square metre at 30 June 2022.
While there has been a strong recovery in sales performance across GPT’s Retail portfolio, given rising interest rates, it is expected that retail sales growth will moderate.
The Group has a growing development pipeline with an estimated end value of $8.1 billion.
Development planning is well advanced for the mixed-use opportunity at Rouse Hill Town Centre, which will include 10,000m2 of incremental retail space and 218 residential apartments. The project is expected to commence in early 2023, subject to market conditions and authority approvals.
The proposed development of Rouse Hill Town Centre features first-to-market retail, dining and lifestyle concepts
Rouse Hill Town Centre has been widely acknowledged as one of Australia’s most successful mixed-use developments, with this proposed next development both positioning the centre for future growth and cementing Rouse Hill Town Centre’s community first focus.
In Melbourne’s vibrant West, GPT has received approval for Highpoint’s mixed-use masterplan, allowing the existing 150,900m2 centre to transform into a thriving Urban Village – located just 8km from the Melbourne CBD.
The approval provides for an additional 148,000m2 of commercial space, 3,000 residential units, 20,000m2 of open space and further retail opportunities. The project will potentially create more than 9,000 new jobs and be home to about 6,000 residents, and capitalises on the continued growth and opportunity in the ever evolving West.
Highpoint’s mixed-use masterplan
In a new initiative, GPT is supporting the restoration of 1,100 hectares of Australian biodiverse native koala habitat in partnership with Greenfleet and the Traditional Owners for permanent removal of its development pipeline residual carbon emissions. The large scale of this nature positive initiative demonstrates GPT’s commitment to operate assets on a carbon neutral basis and deliver upfront embodied carbon neutral developments.
