Investors are being encouraged to hold onto shares in property management business, GPT Group, following reports of improving occupancy rates in its office portfolio.
As part of its third quarter 2014 market update, GPT upgrade its full year guidance from at least three per cent growth to four per cent.
Analysts at ratings house, Morningstar, suggested that the "upgrade was primarily driven by better than expected leasing success", alongside an increase in gearing and growth in funds under management.
"Occupancy for the office portfolio, which accounts for 33 per cent of GPT Group's $9 billion portfolio, increased to 93.1 per cent from 91.7 per cent," Morningstar said.
"We remain of the view that conditions for office landlords in the major cities will remain weak for a protracted period.
"We continue to believe GPT Group benefits from a narrow economic moat, underpinned by its higher-quality retail portfolio where the threat of competitors establishing nearby is stymied by high entry barriers.
"The office assets also benefit from entry barriers, but these are weaker than those for large retail shopping centres in built-up areas."
