Published 31 August 2018
Stride Property Group chief executive Philip Littlewood outlined yesterday how the group’s investment management arm intends to develop its business for the long term.
The NZX-listed Stride’s business is based on property ownership, but it wants to grow the investment management side of the business through commercial property funds.
It manages the Investore Property Ltd bulk retail portfolio and the Diversified NZ Property Trust, and lifted earnings from that side of the business 12% more than forecast in the June 2018 year.
Mr Littlewood told shareholders at the group’s annual meeting in Auckland yesterday: “Over time we will seek to establish a group of commercial property funds to provide the opportunity for further growth in our investment management business.
“We will seek to use Stride Property’s balance sheet to acquire properties that will ultimately be used to establish these new focused funds, with Stride Property co-investing in any new fund, providing alignment of interest between Stride & investors.
“Stride will also seek to leverage the inhouse development capability of Stride Investment Management Ltd to identify & undertake new developments to deliver the strong investment returns we require.
“We also believe there is latent growth opportunity within the portfolios currently managed by Stride Investment Management. In particular, the Diversified portfolio includes Queensgate Shopping Centre, with the rebuild yet to be completed following the Kaikoura earthquake.
“There are also some further portfolio initiatives that are currently in the advanced planning stage within the Diversified portfolio which, if they proceed, will provide additional opportunity for Stride Investment Management.
“This type of growth is indicative of the leveraged investment management model we see for Stride, where, as we establish further products, Stride will incrementally benefit as each of our products performs & grows. Our primary focus is to make sure that we deliver on the plan we set out to investors at fund establishment. We are setting Stride up for a sustainable investment management business which creates long-term value for our investors.”
Attribution: Annual meeting address.