Unrealised revalations add $18 million
Capital Properties NZ Limited increased its March year aftertax operating surplus (before revaluations) by 17.8% to $15.9 million.
Unrealised changes in investment properties added $17.9 million to the surplus to give a $33.8 million net surplus, 5 times the $6.8 million last year.
Chief executive Nick Wevers said the increase in operating surplus was due mainly to increased income from some properties and reduced interest costs as a result of debt repaid from the proceeds of last year’s 1:3 rights issue.
The valuation rise resulted from an increase of $10-15/mÂ² in market rents and a cut of about 0.25% in market capitalisation rates, mainly in the Wellington portfolio.
Earnings/share fell from 10.9c to 10.2c/share, calculated on the operating surplus after tax but before revaluations.
Capital Properties also announced a 4th quarterly gross dividend of 2.25c/share, including 0.35c imputation credits. Gross dividends for the whole year total 9.125c/share, including 1.425c imputation credits. This gross dividend represents a 10.1% yield at the current share price of 91c.
25% rent rise in Bowen House
Mr Wevers said the company had settled a review of rent paid by the Parliamentary Services Corp on 12,118mÂ² of office space & 55 parking spaces at Bowen House, Wellington, resulting in a 24.8% increase, from $2.14 million to $2.67 million/year, effective 16 December 2002.
Capital Properties remains on the lookout for investments but will work on adding to its Thorndon portfolio in Wellington in the meantime.
“Buoyant property markets in Wellington & Auckland in the last 12 months have not been conducive to purchasing additional good-quality property at prices that Capital Properties believes represent good long-term value for shareholders. While opportunities to acquire are limited, the company will focus on adding to the portfolio through building on the company’s 3 Thorndon development sites,” Mr Wevers said.
He expected Auckland & Wellington’s leasing markets to remain strong this year.