Atlas Advisors Australia property investments grow despite challenging market conditions

July 01, 2020 3 min read

Atlas Advisors Australia property investments grow despite challenging market conditions

Atlas Advisors Australia is pleased to announce stronger than expected performance of its real estate portfolio in the fourth quarter despite COVID-19 headwinds impacting the overall commercial property sector.

 

Executive Chairman of leading wealth manager Atlas Advisors Australia, Guy Hedley said the fund manager’s commercial real estate portfolio exceeded expectations despite a challenging market for commercial property.

 

“Our investment in key assets has continued to deliver sustainable value throughout the most challenging period in recent real estate history,” Mr Hedley said.

 

“Our property investments are generating strong and stable income by attracting and retaining quality tenants.

 

“Many of our asset managers are proceeding with landmark designs to reposition properties for the future uses realising greater performance and gains over the medium and longer term.”

 

Key assets

 

Elanor Commercial Property Fund (ASX: ECF)

 

ECF is an externally managed commercial office REIT that listed on the ASX on 9 December 2019.

 

•Funds from operations in fiscal 2020 of $13.4 million or 6.57 cents per security were 9% above the product disclosure statement forecast of $12.3 million;

 

•ECP has revised its forecast for funds from operations up 14.5% to be $24.5 million in 2021;

 

•The Fund acquired Garema Court, at 140-180 City Walk, Canberra, ACT for $71.5 million in February 2020. Garema Court is an A Grade office building leased to the Federal Government.

 

Waverley Garden Shopping Centre, Melbourne, Victoria

 

The Waverley Garden Shopping Centre maintains a quality cash flow and positive market position.

 

•The Centre has performed resiliently despite headwinds amidst the global COVID-19 crisis, with around 97% of tenancies remaining open and fully trading;

 

•The leasing strategy remains focused on strengthening the fresh food precinct, retaining and attracting strategic and strong performing retail tenants as well as the creation of a new medical hub;

 

•Lease of a part of the Centre’s roof in exchange for the cost-effective installation of photovoltaic solar panels to reduce electricity costs for the Centre and retailers, furthering a commitment to environmental objectives;

 

•Net property income of $9.86 million in the fourth quarter was affected by COVID-19, below forecast of $11.53 million;

 

•The payment of the March and June quarter distributions has been funded by the QCAX Australian Property Fund in the form of a loan until the impact of COVID-19 on the Centre’s trading performance is clarified;

 

•The Victorian Government has imposed stage 4 restrictions amidst a second COVID-19 outbreak that will have a significant impact on trading performance in the short-term.

 

Neeta City Shopping Centre, Fairfield, NSW

 

•The trading performance of the Centre was affected by COVID-19 trading restrictions which is reflected in fourth quarter fiscal results;

 

•Net operating income in the pre-COVID-19 period was $7,553,131 exceeding forecasts by $12,270. Post-COVID-19 net operating income declined to $7,027,597. An increased provision for uncollected rent to June of $473,207 was recognised with some retailers affected by mandatory and voluntary closures;

 

•A repositioning strategy was executed in the June quarter which are expected to deliver strong returns for investors;

 

•This strategy will see a premises formerly occupied by retailer Big W converted into a car park;

 

•New anchor retail services are also being attracted for Level 1 of the Centre including a childcare centre, gym and a large specialist grocer;

 

•Lease of a part of the Centre’s roof in exchange for the cost-effective installation of photovoltaic solar panels to reduce electricity costs for the Centre and retailers, furthering a commitment to environmental objectives;

 

•Plans are being assessed for the potential conversion of an upper car park level into a cinema, medical precinct or office precinct.

 

The Centre has outperformed many nearby and larger shopping centres and the majority of the Centre’s retailers continuing to trade.

 

It is expected to deliver strong returns for investors with the impact of COVID-19 expected to be contained to the June quarter.

 

Media Contact

Marianna Papadakis

marianna@mtmm.net.au

Ph: 0414 729 006

 

About Atlas Advisors Australia

Atlas Advisors Australia is a leading funds manager and investment advisory business, operating between China and Australia offering a wide range of financial services and wealth management solutions. With operations in Sydney and Melbourne in Australia and Shanghai in China, we are able to support investors in all China and Australia locations.



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