CFS Retail Property Trust reports damage
The Colonial First State (CFS) Retail Property Trust has reflected the extent of the damage in the listed property market in its latest results.
The net profit of the CFS Retail Property Trust took a 39.9 per cent hit over the 12 months to June 30, 2008, reporting net profit of $669.1 million, down from the previous year’s $1,112.9 million.
According to CFS, this result was due in part to “the difference in the net gain from property revaluations over the two periods”.
Over the 12 months to June 30, 2008, the trust delivered unit holders a total return of -9.1 per cent. This represents outperformance when compared to the relevant benchmarks: the UBS Retail 200 Accumulation Index returned —32.1 per cent, while the S&P/ASX 200 Property Accumulation Index returned -36.3 per cent over the same period.
According to CFS Property Management head of listed property Darren Steinberg, despite the fact that the CFS trust has the highest credit rating in the Australian real estate investment trust sector, it too has suffered the rising cost of capital and debt financing.
CFS said it is clear that the period of compression of capitalisation and discount rates across all types of real estate assets over recent years has now ended, and that capitalisation and discount rates will soften.
“Lack of transaction activity means that independent valuers have not had strong evidence to change valuation metrics to date, but more transactions are likely to occur over the next 12 to 18 months,” a statement from CFS said.
Recommended for you
With active ETFs becoming the latest choice as fund managers target the retail audience, their high fees may be a detractor as research finds investors are shunning those priced any higher than 50 bps.
The possibility of a dissenting vote from shareholder L1 Capital has led Platinum Asset Management to scrap its conversion plan for the $450 million Platinum Capital LIC into an ETF.
Family office Lederer Group has made an off-market takeover bid for ASX-listed Elanor Commercial Property Fund, with chair Paul Lederer taking exception at the firm’s lack of accountability, oversight and transparency.
Janus Henderson is actively seeking to partner with private wealth firms in Australia as it looks to expand its number of strategic partnerships, as well as focus on retirement income product development.
