PFI agreed to rental abatements and deferrals with 45 tenants. Photo / 123RF
PFI agreed to rental abatements and deferrals with 45 tenants. Photo / 123RF
Property for Industry collected about 90 per cent of rents due in April and May and has agreed to rental abatements and deferrals with 45 tenants amounting to about 1.2 per cent of its annual rent, or about $1 million.
Chief executive Simon Woodhams told the annual shareholders' meeting, held virtually because of the coronavirus crisis, that the abatements and deferrals were evenly split, meaning that about $500,000 won't be paid.
On May 8, PFI said about 6 per cent of its tenants were contractually entitled to some form of immediate rental relief while they were unable to access their premises.
Woodhams told the meeting that about two-thirds of tenants had contacted PFI when the country first went into lockdown on March 26 for all but those industries deemed essential.
"As we have moved through the various levels of lockdown and the country has begun to start back up, our focus is on ensuring our tenants are able to perform going forward," he said.
"On a case-by-case basis, a range of solutions have been agreed with a number of tenants to share the impact between the tenant and PFI."
The other way the pandemic and the government's response is impacting on PFI is that its divestment of non-industrial properties has been put on hold. Non-industrial properties accounted for 10 per cent of the portfolio at the end of 2019 after it sold $40m worth during the year.
Woodhams said PFI will sell the remaining non-industrial properties when the time is right.
"PFI has weathered many storms and we believe we are well placed, not only to respond to these latest challenges, but also to capitalise on any opportunities that may arise out the other side," he said.
"Our low gearing and diversified funding mix leave us in a good position to pursue the acquisition of additional quality industrial properties.
"As is our custom, we will continue to target properties that will improve the company's overall portfolio and we believe we will start to see the right kinds of opportunities emerge soon."
PFI's gearing at December 31 was 28.2 per cent.
The company was one of the few to go ahead with paying dividends in the wake of the pandemic, last month paying out 1.8 cents per share for the first quarter.
But chair Anthony Beverley said the company isn't ready to provide forecasts yet, although it may when it reports its first-half results in August.
In April, PFI withdrew guidance provided in February when it expected to pay total cash per-share dividends of between 7.65 cents and 7.7 cents for calendar 2020.
Beverley noted how volatile the share price has been since. While total returns in calendar 2019 were 40 per cent, "we must keep in mind that this is an unusually high return for a company like PFI."
During the worst of the coronavirus crisis the share price fell as low as $1.60 but has since recovered.
The shares are trading today at $2.41, down 1.2 per cent year to date, compared with net asset backing of $2.055.
Beverley was re-elected at the meeting but said this will be his last term, in line with the company's succession plans and that he plans to retire in the next 12 to 24 months.
Those plans have seen Humphrey Rolleston retire at the meeting, after serving on the board since July 1994 ahead of PFI's listing on NZX, and new director Dean Bracewell appointed. His appointment was confirmed at the meeting.
