Booming property market drives billion-dollar profit for Mirvac
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Booming property market drives billion-dollar profit for Mirvac

Booming property market drives billion-dollar profit for Mirvac

It’s not quite in the territory of the major banks but diversified property giant Mirvac’s full-year profit has shot above $1 billion on the back of Australia’s booming real estate market.

The real estate group reported a 42 per cent jump in revenue to $3.05 billion for the 12 months to June 30 from a year earlier.

The group’s strong performance was underpinned by its office and industrial assets which contributed $796 million to a total profit of $1.033 billion, a 69 per cent increase on earnings the year before.

All sectors of the market covered by the group reported large boosts.

Earnings from residential land divisions business more than doubled from the year before and profit from retail shot up to $243 million.

Residential settlement defaults – the big worry for many property developers exposed to Asian buyers – were less than one per cent.

The group negotiated 258 Foreign Investment Review Board settlements (offshore buyers) and secured residential presales for the year of $2.9 billion, up almost $1 billion on the previous year.

The largest volume of sales were from the Woodlea subdivision on Melbourne’s north-west and its Googong project in NSW.

The office portfolio was boosted by recycling assets with sales of $1.6 billion since 2014, on a passing yield of 7.1 per cent.

New developments were added at 200 George Street, Sydney, Treasury Building in Perth, 699 Bourke Street in Melbourne and 8 Chifley in Sydney on a yield on cost of 7.7 per cent.

The result will be a boost for chief executive Susan Lloyd-Hurwitz who has been in the job for more than three years now.

Mirvac declared a final dividend of 5.2 cents a share, taking the total for unit holders over the year to 9.9 cents, up five per cent on the previous year.

As reported by Simon Johanson in the Sydney Morning Herald 17th August 2016