Precinct Properties New Zealand Limited (Precinct) (NZX: PCT) has reported a draft revaluation loss on its property portfolio of approximately $250 million, a decrease of 7.1%, which is expected to reduce net tangible assets by 16 cents per share.
The decrease across the portfolio was mainly attributable to an expansion in capitalisation rates, with asset valuations decreasing by around 8.6% and 5.3% in Auckland and Wellington respectively.
The weighted average capitalisation rate of Precinct’s portfolio is forecast to be 5.6%, compared to 4.9% at 30 June 2022.
Scott Pritchard, Precinct’s Chief Executive, said the rising interest rate environment has placed increasing pressure on investment returns and impacted property valuations.
The final valuation will be confirmed in the financial results for the year ending 30 June 2023, expected to be announced on 23 August 2023.
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