19 Aug 2008

AMP NZ Office Trust profits jump

1:16 pm on 19 August 2008

New Zealand's largest listed commercial property investor has seen its profit rise by more than a quarter, driven mainly by rising rental income.

AMP New Zealand Office Trust posted a profit of $52.18 for the year to June, an increase of 27% on the previous year.

The trust owns 15 office buildings worth $1.5 billion in total. The sites include Auckland's Pricewaterhousecoopers Tower, the ANZ centre and Wellington's State Insurance Tower.

The investor has benefited from booming demand for quality office space, which has been reflected in its result.

Rental income rose 12% to top $120 million, which the trust says reflects recent acquisitions as well as higher rents and longer occupancy rates.

The growth in rents has driven up the value of its portfolio, which increased by $118.4 million during the year.

Trust chief executive Robert Lang says New Zealand's prime office sector is showing strong resilience in the face of a worldwide economic slowdown.

Mr Lang says earnings will continue to grow as 12% of its portfolio is rented at below market rates, and 50% of the portfolio is subject to upward rent reviews.

Unit holders have been rewarded by an 8% increase in the full-year payout to a record 8.4c per unit.