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DNZ lifts contracted rentals slightly, extends lease term

Thursday 5th July 2012

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DNZ Property Fund said leasing transactions in the March quarter have increased its contracted annual rentals by 0.6 percent and lifted its weighted average lease term (WALT) to 5.6 years at June 30 from 5.4 years three months earlier.

In its June quarter portfolio update, chief executive Paul Duffy said management completed 33 lease transactions in the three months, increasing net contracted annual rentals to $58.6 million from $58.2 million.

Of the transactions, 17 were rent reviews over 60,086 square metres for a total annual rental of $7.3 million and seven were lease renewals over 13,960 square metres for a total annual rental of $3.4 million with the major renewal being the Countdown store in Fenton Street, Rotorua, which has been extended to August 2015 and covers 5,172 square metres.

There were nine new lettings covering 23,891 square metres for a total annual rental of $2.1 million.

Major new tenants are NZ Merchant at 20 Rockridge Avenue in Penrose, Auckland beginning October this year for 4.5 years covering 10,239 square metres and Value Tyres at 62 Columbia Avenue, Christchurch beginning August this year for 10 years covering 12,665 square metres.

“Leasing activity by the DNZ management team during the first quarter of the financial year has halved the portfolio lease expiry to 4.7 percent of the porfolio contract rental in full-year 2012 and reduced full-year 2014 to 7.7 percent.”

DNZ shares are unchanged at $1.46, down from their record $1.50 in May. The shares have been trending higher from the year low at $1.17 in August last year.

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