DNZ to pay forecast 2c distribution

Tim Storey. Photo / Brett Phibbs

Listed landlord DNZ Property Fund, with real estate valued at $661 million, will meet projected forecasts for shareholder distributions which are due to be paid next week.

Tim Storey, chairman of the Auckland-headquartered business which listed on NZX last year, said investors would get 2 cents a share for the third quarter, paid on February 24.

Buffy Gill of Goldman Sachs and Partners NZ said this was a positive update and DNZ had increased occupancy across its portfolio of properties from 95 per cent to 98 per cent in a difficult environment.

The company confirmed it would meet its distributable earnings guidance of around $19.2 million for the 2011 financial year, as provided in its initial public offering prospectus out last July, Gill said.

Storey said DNZ has sold property for $57.5 million from last April to January and has further contracts for $13.6 million. Leases on 168 deals were settled and DNZ had finished Fletcher Building's new Laminex Group design/build of premises on O'Rorke Rd at Penrose.

Gill praised the Penrose deal for producing cash.

"We are pleased with the positive progress on filling the remainder of the O'Rorke site, which is currently non-income producing," she said. "We retain our buy recommendation."

DNZ is trading around $1.22.