Charlestown Square
Charlestown Square in NSW; owned and operated by GPT. Photo – Charlestown Square website.
  • ASX-listed property group GTP announced returns of -2.4% for the year 2020
  • The pandemic hit their traditional retail centres as well as office blocks
  • The situation improved towards the end of 2020, the GTP remain optimistic for 2021

After averaging returns of 10% or more over the past five years, listed GPT Group (ASX: GPT) announced total returns for the year were down 2.4% for 2020.

In their annual results presentation today, the Group described the social and economic impact of COVID-19 as “unprecedented”.

Despite an “extraordinarily challenging year”, one of Australia’s largest diversified listed property groups saw a strong return to bricks and mortar stores with re-opened shopping centres towards the latter half of 2020.

During the year, the Group still managed to develop and acquire $400 million of logistics assets, suggesting a strategic shift to diversify into those areas as the traditional property office and shopping spaces met the brunt of the pandemic. Total logistics portfolio has grown from $1.9 billion to $3 billion over the past two years.

Across their portfolio, they reported a very healthy 98.4% occupancy, with more than $24 billion of assets under management.

A second half-year distribution of 13.2 cents per share was announced, taking total year distributions to 22.5 cents (equivalent to 5.5 per cent return.) This is to be financed from free cash flow.

GPT share price
The GPT share price took a hit in the past year. Source – ASX.

The losses overall were mainly attributed to devaluations in the rent portfolio, brought on by the shock to the retail sector. Even so, overall rent collection was 94% of net billings.

Given the hard lockdowns in Melbourne, which accounted for around 40% of their business, the pandemic was always going to bring a hit to some degree. Despite the current snap 5-day lockdown in Victoria, GPT remains optimistic as to the current outlook and prospects for the business.

The company believes it is well-positioned to take advantage of the emerging economic recovery. They have a “strong balance sheet” and have the capacity to invest in strategic growth opportunities.”

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