The iconic blue walls in the Ikea building in Sylvia Park started being installed in November 2024. Photo: Supplied
Kiwi Property Group's says its first half result reflects strong rental and underlying profit growth, with the outlook for the rest of the year in line with expectations.
Still, the Sylvia Park and Drury township developer's net profit fell 77 percent with an unrealised fair value loss of $30.3 million, versus a gain in the prior year.
Key numbers for the six months ended September compared with a year ago:
- Net profit $9.8m vs $43.2m
- Revenue $136.7m vs $128.4m
- Rental revenue $102.7m vs $95.3m
- Underlying profit $62.9m vs $56.4m
- Expenses $45.7m vs $43.8m
- Net tangible assets $1.12 per share vs $1.17 per share
- Interim dividend 2.8 cents per share vs 2.7 cps.
Kiwi Property's flagship build-to-rent (BTR) development, Resido at Sylvia Park, was 99 percent leased.
"This result validates the product offering and the attractiveness of well-located, amenity-rich rental accommodation," chief executive Clive Mackenzie said.
"As we look to the remainder of FY26 and beyond, Kiwi Property is well positioned to benefit from improving economic conditions and the continued execution of our strategy."
ASB North Wharf's lease was extended to 2040, while the Vero Centre, which failed to sell earlier this year, was 94.3 percent leased.
"We are excited about the opportunities ahead, including the opening of IKEA at Sylvia Park in early December, further progress at Drury, and continued improvement in operating conditions for our assets."
The Drury development remained a key priority and focus of the business.
The Drury large format retail sites were 77 percent conditionally sold to big brand name retail stores including Costco Wholesale, Rebel Sport/Briscoes and Harvey Norman.
"Despite a weak economy and a challenging leasing market during HY26, we have delivered strong leasing outcomes across the portfolio," he said.
Total rental growth, including new leasing and rent reviews, rose more than 3.5 percent, with office leasing spreads up 3.4 percent.
"These results underscore the enduring appeal of our assets and the effectiveness of our leasing strategy in subdued market conditions.
"We are focused on ensuring our centres and office assets remain the destinations of choice for tenants, allowing us to maximise rental growth."
Mackenzie said the company stood to benefit from a proposed regulatory change on seismic strengthening, which was expected to remove exempt Auckland buildings, where its assets were concentrated
The company confirmed its full year dividend guidance at 5.6 cents per share.
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
