The company also cited the Government forcing landlords to give rent abatement to retail tenants.
"The recent introduction by the Government of legislation mandating that landlords abate a fair proportion of rent is expected to result in Investore incurring additional rent abatement costs," its results presentation out today said.
"Investore has provided for $1m of rental abatements for the period to September 30, 2021 and expects abatements may be required for up to six weeks following that date for limited tenants in Auckland and Waikato, given the recent reopening of retail of retail in Auckland and Waikato," it said.
Investore owns 44 properties which include Countdown, Rebel Sport, Briscoes and Bunnings and others as tenants.
"Investore has a high proportion of tenants that are classified as essential businesses and able to remain open and trading at all Covid-19 alert levels," the presentation said.
But Mike Allen, board chairman, said many were forced to shut too.
"Although many tenants were able to remain open and trading during all Covid-19 alert levels, Investore still has a number of tenants that were not able to trade during either alert level 3 or 4," he wrote in the half-year report.
The board is considering a listed bond issue in this financial year to extend debt diversity and lower the weighted average cost of debt, he said.
The company has a conditional agreement to buy a Kaiapoi property and that land will provide the business with growth opportunities including the development of a new Countdown, Allen said. Terms had been agreed with Woolworths NZ.
One property will be particularly capital-intensive.
Investore owns a Bunnings at 2 Carr Rd in Mt Roskill and a car park there has problems.
"Bunnings is planning to undertake an expansion of the trade zone and associated improvements along with the planned seismic upgrades funded by Stride Property. Investore will contribute approximately $14m towards the expansion and improvement works with an associated improvement rental and a new 12-year lease on completion," the half-year report said.
Last December, the Herald reported how Bunnings had reopened what was then a $49.2m Mt Roskill store.
The car park at that Bunnings Warehouse was shut to be assessed for seismic issues.
"Initial engineering advice raised a concern with the seismic resilience of the car park, however, Bunnings' landlord Investore Property, has now had further, in-depth analysis undertaken," Bunnings said last December of the unusual situation.
Bunnings' NZ director Jacqui Coombes said the store had only been shut temporarily.
But despite problems, valuers assessed the property as having more worth. Latest accounts show 2 Carr Rd valued previously at $53.4m but now $54.4m.
Investore is trading around $1.86 today, down 16 per cent annually and with a market capitalisation of $684m.
