Retail property falls in value at Argosy because of Covid 19 disruption to trade
Thursday, 23 April 2020
Retail property has fallen in value at large property company Argosy because of the impact of coronavirus Covid-19 on retail trade but industrial and office buildings have risen.
The company's portfolio of properties rose overall by 3.6 per cent from a year ago to be worth $1.78 billion on March 31 2020.
Argosy chief executive Peter Mence said: 'We are very pleased to see our diversified portfolio of quality assets demonstrating resilience in challenging times.'
It contrasts with Kiwi Property's announcement its overall portfolio of shopping centres and office buildings had fallen in value by 8.5 per cent, almost $300m, to $3.1b. Kiwi's portfolio has a much greater proportion of retail properties than Argosy's.
**READ MORE:
* Coronavirus: Level 3 won't be the magic tonic for retailers struggling under Covid-19 restrictions
* Massive retail drop as restrictions take hold
* The $89m sale of Albany Lifestyle Centre is a likely victim of Covid-19
* Covid-19 disruption slashes the value of Kiwi Property's portfolio by almost $300m**
The value of Argosy's retail portfolio, generally large format retail stores, including Albany Mega Centre, north Auckland, declined 6.5 per cent to $184.5 million.
Argosy's industrial buildings rose most in value, by 6.8 per cent to $842.8m while office buildings rose by 2.9 per cent to $756m.
Since desk-top valuations in September 2019 were done the emergence of Covid19 had changed the current global economic environment, Mence said.
For the March 31 2020 valuations, independent valuers had made adjustments to rental and vacancy assumptions, particularly for properties they considered to be the most affected by Covid-19.
By location, Auckland was the largest contributor to the revaluation gain with $49.7m or 81 per cent of the total portfolio gain.
The valuations remained subject to audit by Deloitte and would be confirmed in the financial results to be announced on May 20.