8 Nov 2011

NPT looks to Auckland to diversify portfolio

8:00 am on 8 November 2011

Property investment company NPT is to look to Auckland for acquisitions as it tries to balance its property portfolio away from earthquake-damaged Christchurch.

The listed property investor, which corporatised from a trust earlier this year, lost $9.8 million in the six months to the end of September, compared with a loss of $13 million in the same period in 2010.

NPT's acting chief executive Kerry Hitchcock says the loss is largely due to unrealised write-downs on the company's portfolio, particularly its Eastgate Shopping Centre in eastern Christchurch and Natcoll House in the city's red zone.

When one-off charges and adjustments are stripped out, underlying profit was $5.4 million - almost 23% higher than a year earlier.

Mr Hitchcock says NPT is relying on business interruption insurance for lost rent at the moment but it will try to replace that over the next 12 months.

He says the company recognises it is over-exposed in Christchurch and needs to diversify its portfolio.

Mr Hitchcock says NPT has recently sold a property in Henderson and is now looking for new Auckland investments.

He says the company is looking for larger properties and wants to concentrate on net rather than gross leases after the Christchurch experience - where owners with gross leases are carrying a lot of inflation and cost escalations that NPT can't pass on.

The company's portfolio decreased in value from $169 million to $162 million during the six month period.