Argosy Property says the market's in a better position now then it has been for years and it is feeling upbeat about its future prospects.
The listed property investor reported solid growth for the six months to September, excluding non-cash profits, the amount Argosy can distribute rose 18% to nearly $24 million.
Argosy says about $113 million worth of property including vacant land in its portfolio will be divested as market conditions allow.
Chief executive Peter Mence said the company's strategy also includes diversifying its portfolio to be 20% retail, 40% commercial and 40% industrial.
He said Argosy has a five year plan to look for industrial property in the Auckland region and over time it is likely retail weightings will decrease and industrial weightings will increase.
Mr Mence said the company sees retail as more volatile than industrial.
He said there are challenges to the retail area in terms of availability of land and expansion of the internet which create a level of volatility.
"As far as delivering good returns reliably to our shareholders, whilst it will always have a place as a sector, we don't see that it's appropriate to continue to hold it at the 30% ratio that we have done in the past."
Mr Mence said the outlook is positive with lower vacancy rates and increased demand from existing and future tenants.
Argosy reported a net profit of $30 million for the six months to September, compared with $4.5 million for the same period last year.
The profit includes a $16 million gain from hedging contracts, compared with a $13 million loss last year, which Argosy says reflects recent increases in long-term interest rates.
