20 Nov 2013

Goodman doubles its interim profit

3:03 pm on 20 November 2013

Goodman Property Trust's first-half profit more than doubled to $65.4 million, largely because of the rising values of its properties and interest-rate hedges.

The profit the trust can distribute rose more than 21% to more than $45.6 million for the six months to September, with rental income rising 25%.

The trust is buying Fonterra's new head office for $92.6 million.

The building is being constructed on Auckland's Viaduct and the trust is paying a 5% deposit now with the balance expected to be paid in February 2016.

The purchase price implies a cash yield of 8%.

Goodman (NZ) Ltd chief executive John Dakin says the strengthening economy and rising business confidence has led to improving demand from tenants which is supporting the trust's development program.

"There's two sorts of things that have come through in the first six month ... our leasing across our existing portfolio of about 80,000 square metres (of floor area) is 10,000 to 15,000 square metres above what we would ordinarily do, and then in our new development starts we've had the strongest six months we've had for over five years," Mr Dakin says.

The trust has announced 10 new projects, worth nearly $87 million, since March this year.