Listed Property Trusts

[Rawz]

Perhaps the reits with the biggest development pipeline will get hurt the most with this inflation? cost of builds going to skyrocket. Better to just sit on your portfolio of buildings and let inflation boost your rents and chip away at your debt.

Who has the biggest development pipeline? Looking at you KPG... No wonder it trades at the biggest discount to its peers

[fungus pudding]

Perhaps the reits with the biggest development pipeline will get hurt the most with this inflation? cost of builds going to skyrocket. Better to just sit on your portfolio of buildings and let inflation boost your rents and chip away at your debt.

Who has the biggest development pipeline? Looking at you KPG... No wonder it trades at the biggest discount to its peers

Exactly - completed buildings are a great hedge against inflation. But the ones still on the drawing board can suffer in the short term.

[LaserEyeKiwi]

Perhaps the reits with the biggest development pipeline will get hurt the most with this inflation? cost of builds going to skyrocket. Better to just sit on your portfolio of buildings and let inflation boost your rents and chip away at your debt.

Who has the biggest development pipeline? Looking at you KPG... No wonder it trades at the biggest discount to its peers

KPG only has $300 million in current capex commitments, mostly from the one major development underway currently which is already under construction - Sylvia Park BTR 1 (3 Te kehu way office tower is basically finished - to be occupied in 2023). Other than that it is just earthworks at Drury for the next 12-24 months.

They were very clear in last weeks investor day presentation that they will only commit to further development as market conditions allow.

[Rawz]

KPG only has $300 million in current capex commitments, mostly from the one major development underway currently which is already under construction - Sylvia Park BTR 1 (3 Te kehu way office tower is basically finished - to be occupied in 2023). Other than that it is just earthworks at Drury for the next 12-24 months.

They were very clear in last weeks investor day presentation that they will only commit to further development as market conditions allow.

Still, one day that drury land will be developed into a wonderful utopia and as we sit here that future cost is rapidly increasing.

[LaserEyeKiwi]

Still, one day that drury land will be developed into a wonderful utopia and as we sit here that future cost is rapidly increasing.

First up planned for Drury development proper is a “big box” retail center (“LFR Stage 1”).

Edit: Actually “LFR Stage 1” might be the big box centre going to be built at Sylvia park beside IKEA. But from previous plans I remember big box retailers were first stage of Drury as well.

But was surprised to hear that KPG also will have residential land sales as well from Drury to raise funds (I assumed residential land sales would only be done by the other Drury partners land holdings)

Development timetable from investor day:
D50ECA0C-56AB-4B49-AEA2-32E3E11AF79B.jpg

[LaserEyeKiwi]

Sylvia Park is really going to be a little city by the time that development schedule is finished: Many more BTR developments , 4 more office towers, more LFR, and even a hotel.

Attachment 14158

[Waltzing]

KPG is certainly a very serious and powerful development group but is the CAP EX going to cover the considerable future expansion.

LEK may well have covered this already.

Is the expansion something can be self funded from current assets and future sales generated profits.

Looks like some of those artists impression and tables of future DEV in their presentations are very heavy on CX..

GMT powering up again... blue chip according to one property manager in auckland we speak to most weeks.

[LaserEyeKiwi]

KPG is certainly a very serious and powerful development group but is the CAP EX going to cover the considerable future expansion.

LEK may well have covered this already.

Is the expansion something can be self funded from current assets and future sales generated profits.

Looks like some of those artists impression and tables of future DEV in their presentations are very heavy on CX..

GMT powering up again... blue chip according to one property manager in auckland we speak to most weeks.

They have been talking about the “co-investment platfrom” as funding source a lot recently (not just for the intended upcoming standalone office portfolio sell down, but across their entire portfolio). They have a rather low average cost of debt, and none coming up for reneweal until ‘24, and it seems they dont really want to tap the debt market again while rates are high.

I’ve shared this before, but the asset selldown makes a lot of sense while the share price is trading so far below the book value - especially if they achieve “co-investment” near the book value, and it has the bonus of generating new income from the management fees being charged to the new equity partners.

[Rawz]

Is the KPG dividend at risk to develop Drury?

[LaserEyeKiwi]

Is the KPG dividend at risk to develop Drury?

Nope. Drury is a long term project - see development timeline above, and will be funded primarily from: asset sales (either outright like Northlands, or “co-investment” in existing & future portfolio) or debt.