GPT Aims to Boost Funds Management, Development Business to Boost Earnings
GPT Group (GPT), Australia’s second- biggest diversified property trust by market capitalization, plans to expand its funds management and development businesses this year as it seeks to boost earnings.
The company is exploring “opportunities to increase the contribution development makes to our earnings, and that may mean more mixed-use type developments,” Managing Director Michael Cameron said today in a telephone interview. “Our funds have been able to raise a stack of capital, so we’re really well placed to borrow or raise money to acquire assets in those funds, or establish new funds.”
GPT today reported operating income that rose 7 percent to A$438.8 million ($473 million) in the 12 months to Dec. 31, after selling “non-core” assets at home and abroad to focus on its domestic office, retail and industrial properties. Net income declined to A$246.2 million due to losses on derivatives, it said in a statement to the Australian stock exchange.
The Sydney-based company will explore options for funding new developments, including on its own, with outside investors and in partnership with its funds, Cameron said, declining to provide a target the company wants to expand the development and funds management businesses to.
GPT climbed 1.3 percent to A$3.12 at the close of trading in Sydney, the highest in more than a month.
The group will also seek to boost its holdings of industrial properties, which now make up 9 percent of its portfolio, Cameron said, declining to specify a target.
GPT, which said in November it will internalize the management of the industrial and office properties as part of its strategy to actively manage the properties it owns, will also explore offering property management services to other groups to generate new revenue streams, he said.
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