DNZ Property Fund's half-year profit rose by almost 50 per cent after rent renewals and lease reviews produced solid revenue growth.
The real estate investor delivered a net profit of $12.1 million for the six months ending September 31, up from $8.2m in the same period a year ago. Rental income was $26.9m, up 3.9 per cent.
DNZ shares rose 0.3 per cent to $1.58 in response to the earnings announcement, a 5c premium on its net tangible assets.
Distributable profit, the earnings measure preferred by property investors, came in at $12.7m or 5.15 cents per share, compared to $13m or 5.27 cents per share a year ago once tax was factored in.
The firm said it had secured 105 leases in the six months, lifting occupancy levels to 99 per cent from 98.7 per cent previously. The weighted average lease term was 5.7 years across the portfolio, up from 5.4 per cent.
"DNZ management has achieved excellent results, particularly in DNZ's Wellington office portfolio, with new long term leases to quality tenants," said chief executive Paul Duffy.
The firm also bought a fully occupied office building in Albany, north of Auckland, for $12.9m. Almost 80 per cent is rented to Westpac under a new nine-year lease.
The firm said four of its five sites have been declared earthquake prone following a full seismic review, representing $25m or 3.75 per cent of its portfolio value.
A second quarter dividend of 2.25 cents per share was declared, and carries imputation credits of 0.694 cents. It is payable to shareholders on December 13.