Stockland (ASX:SGP) reports strong residential sales despite Covid-19 restrictions

Company News

by Lauren Evans

Stockland (ASX:SGP) maintained momentum in its residential and commercial sales during the September quarter. The news was underpinned by its FY22 guidance remaining unchanged, despite ongoing Covid-19 disruptions.

The property giant recorded total residential sales of 1,947 lots, up 8 per cent from the prior June quarter, as purchaser demand remained elevated nationally despite the roll off of HomeBuilder in March this year and Covid-19 restrictions throughout the period. Retirement living results came in as the company anticipated, with 156 sales generated as Covid-19 restrictions impacted activity levels over the quarter.

In commercial property, retail town centres delivered comparable total sales growth of 2 per cent. This result was again, impacted by restrictions, particularly lockdowns in both NSW and Victoria. Over 150 leasing deals were completed during the quarter while negotiated rents are tracking ahead of expectations with rent collection was at 75 per cent before any adjustments for abatements or deferrals for the quarter.

"During this quarter we continued to deliver on our key strategic priorities, rebalancing our portfolio to provide future growth while generating stable long-term returns. Our communities business maintained its strong residential sales momentum with new enquiries remaining elevated. The Commercial Property business saw occupancy rise to 99 per cent across the Logistics and Retail portfolio,” said CEO Tarun Gupta.

“In undertaking the review, we have considered four key long-term drivers that we expect to shape our industry: urbanisation; the impact of rapid technological advancement; the continued growth of institutional capital flows; and the critical importance of environmental, social and governance (ESG).”

Stockland reconfirms its FY22 guidance with fund from operations (FFO) per security forecast to be in the range of 34.6 to 35.6 cents, while the company said that current market conditions remain “uncertain and challenging”. All forward looking statements including FY22 earnings guidance are provided on the basis that the vaccination roll out continues.

Shares in Stockland (ASX:SGP) are trading 0.9 per cent higher at $4.64.

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