New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<ul><li>Kiwi Property (KPG) have announced 2H23 draft revaluations for the six-months to 31 March 2023.</li><li>The preliminary result is a -NZ$135m devaluation which we understand largely relates to KPG’s investment property portfolio with properties held for sale, development land, and other properties broadly unchanged</li><li>KPG’s investment property portfolio with properties held for sale, development land, and other properties broadly unchanged</li></ul>

Kiwi Property (KPG) have announced 2H23 draft revaluations for the six-months to 31 March 2023.The preliminary result is a -NZ$135m devaluation which we understand largely relates to KPG’s investment property portfolio with properties held for sale, development land, and other properties broadly unchangedKPG’s investment property portfolio with properties held for sale, development land, and other properties broadly unchanged

Thematic (Sector/Industry)

<ul>
<li>Last year was a turbulent time for listed property vehicles (LPVs) - the sector was down -26% in the year as it adjusted to the higher interest rate environment</li>
<li>Valuations remain above historical relationships with bond yields, and the growth outlook has moderated</li>
<li>The sector is trading c-30% below its net asset backing but we consider this largely priced in.</li>
</ul>


Last year was a turbulent time for listed property vehicles (LPVs) - the sector was down -26% in the year as it adjusted to the higher interest rate environment
Valuations remain above historical relationships with bond yields, and the growth outlook has moderated
The sector is trading c-30% below its net asset backing but we consider this largely priced in.


Real Estate Reflections: Five Themes for the Year Ahead

<ul><li>1H23 listed property results highlighted solid operational outcomes, but we are starting to see higher interest rates impact forward earnings expectations and capital management strategies</li><li>Development is being delayed, non-core assets sold and distribution growth moderated</li><li>While results were generally in line with our expectations, we lowered our earnings and dividend forecasts for most of the sector</li></ul>

1H23 listed property results highlighted solid operational outcomes, but we are starting to see higher interest rates impact forward earnings expectations and capital management strategiesDevelopment is being delayed, non-core assets sold and distribution growth moderatedWhile results were generally in line with our expectations, we lowered our earnings and dividend forecasts for most of the sector

Real Estate Reflections: Adjusting to a Higher Rates Environment

<ul><li>High interest rates and low transactions volumes has created uncertainty around commercial property valuations</li><li>Our analysis suggests that most property balance sheets can withstand a significant decrease in asset values with Argosy (ARG), Goodman Trust (GMT), and Property for Industry (PFI) the most resilient given low current gearing and/or limited capital commitments.</li><li>Kiwi Property (KPG), Stride (SPG), and Vital Healthcare (VHP) have the least resilient balance sheets owing to either higher initial gearing and/or significant capital commitments</li></ul>

High interest rates and low transactions volumes has created uncertainty around commercial property valuationsOur analysis suggests that most property balance sheets can withstand a significant decrease in asset values with Argosy (ARG), Goodman Trust (GMT), and Property for Industry (PFI) the most resilient given low current gearing and/or limited capital commitments.Kiwi Property (KPG), Stride (SPG), and Vital Healthcare (VHP) have the least resilient balance sheets owing to either higher initial gearing and/or significant capital commitments

<ul><li>KPG reported a solid 1H23 result that was slightly ahead of our expectations on an underlying basis</li><li>Trading at its malls has been strong, with shoppers returning post COVID and rents are growing</li><li>KPG continues to recycle capital to fund its committed projects but gearing on our numbers remains towards the top end of target range and ongoing earthquake spend remains a drag.</li></ul>

KPG reported a solid 1H23 result that was slightly ahead of our expectations on an underlying basisTrading at its malls has been strong, with shoppers returning post COVID and rents are growingKPG continues to recycle capital to fund its committed projects but gearing on our numbers remains towards the top end of target range and ongoing earthquake spend remains a drag.

Kiwi Property Group: 1H23 Result: Has Wings but Can't Fly

New Zealand

Kiwi Property Group Ltd is a property trust that invests in, manages and develops a portfolio of diversified properties throughout New Zealand. The Trust's properties include office, retail and industrial properties.

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Kiwi Property (KPG NZ)

Kiwi Property: 2H23 Revaluation Update

Kiwi Property (KPG) have announced 2H23 draft revaluations for the six-months to 31 March 2023; the preliminary result is a -NZ$135m devaluation...

Forsyth Barr

Real Estate Reflections: Five Themes for the Year Ahead

Last year was a turbulent time for listed property vehicles (LPVs) - the sector was down -26% in the year as it adjusted to the higher interest...

Forsyth Barr

Real Estate Reflections: Adjusting to a Higher Rates Environment

1H23 listed property results highlighted solid operational outcomes, but we are starting to see higher interest rates impact forward earnings...

Forsyth Barr

Listed Property Insights: In the Balance

High interest rates and low transactions volumes has created uncertainty around commercial property valuations, which has manifested in the NZ...

Forsyth Barr

Kiwi Property Group: 1H23 Result: Has Wings but Can't Fly

KPG reported a solid 1H23 result that was slightly ahead of our expectations on an underlying basis; It continues to recycle capital to fund its...

Forsyth Barr

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Market Cap (USDm)

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