tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Saturday, May 25th, 1:32PM

News

rss
Latest Headlines

Industrial holdings leave Provincia in strong position

Tales of strife and problems abound in the commercial property world these days, but the impact of the Covid-19 pandemic has not been as devastating for all commercial players.

Thursday, May 14th 2020, 10:21AM

by The Landlord

Olly Newland

Provincia Property Fund has just released a statement which forecasts no change on its previously forecasted pre-tax cash yield target of 6% per annum for the year to 31 March 2021.

The fund’s managing director, Carl Burling, says this is thanks to the clearly stated strategy they have long operated under.

That strategy means that the fund does not invest in retail or office properties.

“Instead we concentrate on the best-located industrial investments, which is the safest and most defensive of all commercial property categories.

“As a result of this strategy, 82% of the fund’s full rent roll is still being received during lockdown, with the remaining 18% being abated or deferred.”

“A large majority of our tenants were classified as essential from the outset, and with the move from level four to level three most of tenants were back to work.”

However, the fund did provide mandatory financial relief for the small number of their tenants who were affected by the lockdown.

Burling says that, in return for this, they have negotiated a number of early lease renewals.

Additionally, they have secured much longer terms for three of their major tenants who make up over 45% of the fund’s total income, he says.

Northpower (Arwen Pl, East Tamaki), Goodman Fielder (Great South Rd, Penrose) and Filtec (Carbine Rd, Mt Wellington) have all extended their leases for terms ranging from three to six years.

This means that the fund’s weighted average lease term (WALT) has improved which makes for improved continuity of rent and gives shareholders better security than ever.

Burling says that whatever the post-lockdown environment throws up, their best estimates and predictions are that they should remain at their current level or better in the months to come.

“With the advent of Covid 19 the future of retail is now firmly online. Bricks and mortar retail will continue to suffer.

“But increased demand for online retail will create further demand for well-located warehousing and the third-party logistics and freight companies that operate in this space.”

“We are already invested in these areas and we are poised to take advantage of increased demand for this sector.”

Provincia Property Fund was established in 2017 to provide an alternative to the direct ownership of low-risk industrial property for aspiring commercial investors.

It is an unlisted limited liability company which invests in medium-sized industrial properties in growth areas. Shareholders own shares in the property fund company, which in turn directly owns the properties.

According to the fund’s chairman, veteran investor Olly Newland, its aim is “to make an expensive asset class accessible to investors while avoiding the multiple layers that often come between investors and the underlying assets”.

It also allows for investors to maintain most of the benefits of direct ownership, he said.

Tags: commercial property coronavirus Covid-19 demand Forsyth Barr investment property investment property syndicate rents tenants yield

« Elephant in the room at level twoResilience needed in face of change »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.74 7.29 6.59
SBS Bank Special - 7.14 6.69 5.99
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.21 7.29 6.65

Last updated: 20 May 2024 10:01am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com