Benefitting from leasing spread: Aventus, a fund established to invest in Australian retail property, has retail showrooms in some large format retail centres in Australia. Since IPO, the combination of active portfolio management, value enhancing developments and strategic acquisitions have contributed to a total unitholder return from the fund of 31.9%. The fund has increased its land bank (total site area) to 1.3 million sqm in FY17. Funds from operations’ (FFO) earnings of 17.7 cents per unit (cpu) has also been in line with the guidance of 17.5 cpu. The focus on value adding development projects is expected to drive benefits going forward and these include, redevelopment of the former Bunnings tenancy that is on budget and programmed for completion during the first quarter of FY18, construction of the first child care facility in the portfolio at Cranbourne Home, and 11 planning approvals sought for further expansion in eight AVN centres. Overall, key aspects to note include the fund’s exposure to large format retail assets and leases to a varied range of tenants with structured rental growth. However, headwinds in the retail sector including the ones from Amazon’s entry in Australia appear to be important to keep in mind. Nonetheless, it is expected that the group might be able to mitigate these headwinds given its focus on occupancy, incentives, and leasing spreads. AVN has forecasted its FY18 FFO guidance of 2%–4% higher than FY17 FFO per unit.
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.