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Goodman to spend $33.4M on developments

Goodman to spend $33.4M on developments, nets $16.37M on Chch property

By Suze Metherell

Sept. 19 (BusinessDesk) - Goodman Property Trust, which is selling assets to fund development, will spend $33.4 million on four developments and has sold the Carter Holt Harvey Packaging Facility in Christchurch for $16.37 million to an undisclosed buyer.

The four developments are expected to generate around $2.8 million of annual income and boost valuation gains between 10 percent and 15 percent, Goodman (NZ), the manager of the Auckland-based property investor, said in a statement. The $33.4 million in development adds to the $77.9 million worth of developments Goodman announced earlier in the year. It expects to start over $100 million worth of new project this financial year.

Goodman is adding a 5,400 square metre warehouse to its Auckland Highbrook Business Park and is extending its warehouse at the South Auckland Westney industry park, of which DSL Logistics has committed to 3,000 square metres of new floor space. At its Central Park corporate centre in Greenlane it is upgrading its childcare and gym facilities as well as building a multi-level 600 spaces carpark.

The sale of its Christchurch packaging facility brings the property investor's total sale of assets to $45 million.

"A growth strategy focused on asset recycling is enhancing the portfolio and contributing to strong investment gains for the trust," chief executive John Dakin said. "A buoyant investment market, with both local and offshore investors competing for stock, means that asset sales are not the trust's preferred source of development funding."

Goodman lifted distributable earnings after tax, a measure of profit that strips out valuation movements, 10 percent to $92.9 million in the year ended March 31, as rental income came on stream from new acquisitions, and flagged asset sales to fund future developments.

Units in the trust were unchanged at $1.06 and have gained some 7.6 percent since the start of the year.


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