Argosy Property Limited Analysis

Overview

Argosy Property Limited initially joined the NZX in December 2002 as the Paramount Property Trust, following a public offering of 25.3m units at $1 each. Since then Argosy has grown to be one of the largest diversified property investment vehicles listed on the NZX, and undergone a number of changes in its management structure.

Prior to management internalisation in August 2011, Argosy was managed by entities controlled by the Symphony Group, ING and most recently ANZ. In August 2011 Argosy's shareholders voted to buy the management rights, and adopted a company structure in February 2012. These transactions have moved Argosy from an externally managed unit trust structure to its present, simpler, company structure.

After property sales to manage debt levels during the global financial crisis, in December 2012 Argosy announced an institutional placement and share purchase plan which raised $100m of capital to fund the acquisition of two Wellington investment properties. In July 2013 Argosy announced an underwritten renounceable rights issue which raised a further $80m of capital to maintain debt levels within its target range and fund future acquisitions in accordance with its portfolio investment strategy.

Argosy published its portfolio investment strategy in its 31 March 2013 annual report. The strategy identifies key features of properties that Argosy will seek to acquire, and sets target bands for the mix of its diversified retail, industrial and commercial property portfolio.

Performance

The following information was extracted from Argosy Property Limited's annual results, released 21 May 2025:

Key results for the period include:

• Net property income for the period of $116.9 million, up 0.4% on the prior comparable period;
• $72.7 million revaluation gain for the 12 months to 31 March ($111.7 million revaluation loss in the prior comparable period), up 3.6% on book value, contributing to a full year net profit after tax of $125.9 million (loss of $54.5 million in the prior comparable period);
• Net distributable income of $55.8 million, the same as the prior comparable period (note this year Argosy incurred incremental tax expense of $2.8 million, following the Government’s removal of tax deductions for depreciation on buildings);
• Sound portfolio metrics, with occupancy at 96.5% and WALT of 5.1 years;
• NTA per share of $1.53 up from $1.45 at 31 March 2024;
• Portfolio gearing steady at 35.7%, in the middle of the target band of 30-40%;
• Divested and settled the non Core asset at 8 Forge Way for $35.2 million, achieving above book value;
• Successful portfolio leasing and rent review outcomes, including 3.5% annualised rental growth on rents reviewed and 86% tenant retention rate;
• Progress on green developments, continuing our portfolio transformation and progress to a 50% green portfolio by 2031 (37.2% at 31 March 2025);
• Argosy achieved notable success at the annual Property Council of New Zealand (PCNZ) Awards. The company won the Supreme Award for its 6 Green Star Built property located at 8 Willis Street/Stewart Dawsons Corner. This property was also Highly Commended at the World Green Building Council’s Asia Pacific Leadership in Green Buildings Awards.
• Additionally, the 6 Star Green Built property at 105 Carlton Gore Road received an Excellence Award at the PCNZ Awards. These accolades further underscore the quality-of our portfolio and our commitment to sustainable practices;
• Appointment of Alex Cutler to the Board, as part of the Board succession process; and
• FY26 dividend guidance of 6.65 cents per share, consistent with the prior year.