Dexus Affirms Guidance After Strong Leasing Across ‘Solid’ Office Markets

Sydney-based fund manager and developer Dexus reconfirmed its market guidance for the 12 months to June 2019, thanks to strong leasing in Sydney during the first quarter and profits from divesting a Melbourne commercial asset with development approval.

Dexus chief executive Darren Steinberg said the group was on track to achieve its guidance of “circa five per cent growth in distribution per security” for the 2019 financial year.

Related: Dexus Sells Melbourne Carpark to GPT for $87m

“Looking closely at Dexus’s $13.3 billion property portfolio, our latest results for the September quarter show that the positive market fundamentals are continuing to flow,” Steinberg said.

The Sydney-based fund manager and developer said key milestones across its $4.2 billion development pipeline, include the commencement of development works in Perth’s 240 St Georges Terrace.

The group also replenished its industrial development pipeline with agreements to purchase three development sites in Melbourne, Sydney and Brisbane with a combined end value of around $700 million.

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Dexus splashed $230 million on a prime office development site, two neighbouring assets at 60 and 52 Collins Street in Melbourne, last month.

Along with the addition of 140 George Street in Parramatta, which Dexus says increases the pipeline of potential concept opportunities to the $2.9 billion mark.

Related: Dexus, Frasers Progress Plans for Sydney's 'Silicon Valley' at Central Station

Dexus executive general manager, office and industrial, Kevin George said leasing across the group’s core office markets remained solid with a significant proportion of the leasing during the quarter undertaken in Sydney.

Over the quarter ending September, 41,673sq m of office space was leased across 46 transactions.

Notable activity during the period included securing a substantial portion of 2 and 4 Dawn Fraser Avenue Sydney Olympic Park, with 60 per cent of the total space across both buildings now committed.