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Shopping Centres provides FY'18 guidance, details H1'18 acquisitions

Shopping Centres Australasia Property Group provided its earnings guidance for fiscal year 2018 and detailed completed property transactions during the first half of the fiscal year.

The shopping center-focused REIT said its per-unit guidance for funds from operations for fiscal full-year 2018 increased to 15.3 Australian cents per unit, up 4.1% year over year.

Aside from the positive FFO outlook, the company also anticipates distributions of 13.9 cents per unit for the period, higher by 6.1% compared to the actual distributions made in fiscal year 2017, attributing the increases in FFO and distribution guidance to its acquisitions and lower-than-expected debt.

Meanwhile, during the six months to Dec. 31, 2017, the company was able to complete four acquisitions totaling A$38.3 million. The Coles-anchored neighborhood center in Cairns, Queensland, was bought for A$24.8 million at a 7.01% capitalization rate. The Shell Cove site in New South Wales was purchased for A$1.5 million, with a plan to develop the site into a Woolworths-anchored shopping center. Shopping Centres also acquired the remaining stratum interests in the Belmont NSW and Coorparoo QLD neighborhood centers that opened up opportunities to develop the sites.

In the second half of the fiscal year, the retail REIT said it will focus on finishing the development of two new shopping centers in Bushland Beach, Queensland, and on the Shell Cove site, which are expected to be completed in the second half and in November, respectively.

CEO Anthony Mellowes also said in the earnings release that a third unlisted fund, SURF 3, will be launched within the second half of the fiscal year. The fund will contain some of the company's remaining noncore assets.