Kiwi Income Property Trust Annual Valuation

Kiwi Income Property Trust Announces Full Year Property Portfolio Valuation

Kiwi Income Property Trust today reported a reduction of approximately $8.7 million (0.5%) in the value of its portfolio of prime office and retail assets for the six months to 31 March 2010, bringing the total portfolio value reduction for the financial year ending 31 March 2010 to approximately $74.6 million. The reduction decreases the value of the Trust’s total portfolio by 3.9% to $1.85 billion for the financial year to 31 March 2010.

The valuations were determined by independent valuers, are subject to final audit and will be confirmed in the Trust’s financial result for the year to 31 March 2010.

Sean Wareing, Chairman of the Manager of the Trust said, “The modest 0.5% adjustment in the value of the property portfolio from these latest valuations indicates that property values are stabilising consistent with recent improvements in global economic conditions.”

“The Trust continues to benefit from the strength of its premium assets, its sector diversification in both retail and office properties and its diverse and high-quality tenant base. Underlying operating earnings remain sound,” Mr Wareing said.

Chris Gudgeon, Chief Executive of the Manager, commented that the downward value movement of the portfolio over the last 12 months was largely contained within the office portfolio. “Whilst capitalisation rates have stabilised, the values reflect concerns around the future level of office rents. Conversely, over the last six months the value of the retail portfolio has increased by $16.7 million with the most significant contributor being Sylvia Park Shopping Centre in Auckland which was valued at $452 million, providing a revaluation gain of $15 million, with the capitalisation rate remaining at 6.88%,” he said. “It is also pleasing to see the recently redeveloped Plaza Shopping Centre in Palmerston North contributing to value growth, with the on-completion valuation increasing 4.5% over the previous valuation.”

“Looking forward, our higher exposure to the retail sector should continue to assist in countering the softer outlook for the office sector.”

The portfolio weighted average cap rate increased from 7.70% at 31 March 2009 to 7.86% at 31 March 2010.

ENDS

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