Dexus books $1.73b profit, expects more rental growth across Australia

Dexus delivered a strong $1.73 billion net profit after tax, booking rental increases of up to 26 per cent in the tight Sydney market.

The office space landlord has delivered like-for-like income growth of 4.5 per cent for its office portfolio and expects this rate of growth to persist onto 2019 due to fewer office building vacancies, opening opportunities for higher new rents.

Dexus chief Darren Steinberg said he expected capitalisation rates to tighten further, meaning values are likely to rise further in the next year after having already risen $1.2 billion across the total portfolio in fiscal 2018.

“From an asset value perspective, we expect further cap rate compression of circa 10 to 15 basis points over the next 12 months, driven by continued investment demand, combined with strong property fundamentals in Sydney and Melbourne and improving conditions in Perth and Brisbane.”

Image source: Daniel Munoz

Article source: https://www.afr.com/real-estate/dexus-books-173b-profit-expects-more-rental-growth-across-australia-20180814-h13z4e


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