Mirvac shares rebound on asset sale
Make us a preferred source
Make us a preferred source on Google
More news: Mirvac shares clawed back most of Thursday's losses in morning trade, after the property developer announced that it would sell part of a $2 billion Sydney office development to Japanese group Misui Fudosan.
Shares were up 5.2% to $1.91 by 11:15am AEST.
On Thursday, Mirvac closed 5.71% lower after Morningstar cut its fair value estimate on lower development margins.
Mirvac sells stake in $2b Sydney office development to Misui Fudosan
The news: Property developer Mirvac has reaffirmed its FY24 guidance and has announced that it will sell part of a $2 billion Sydney office development to Japanese group Misui Fudosan.
The numbers: Mirvac has exchanged a 66% interest in 55 Pitt Street to Misui Fudosan, an office development with a total estimated end value of around $2 billion.
Since its third quarter update last month, Mirvac said it delivered on its $1 billion asset sales program, including 367 Collins Street, Melbourne, which is expected to complete in July.
Meanwhile, the sale of Aspect South Industrial precinct in Sydney into the Mirvac Industrial Venture (MIV) has been completed, with Australian Retirement Trust acquiring a 49% interest, bringing the total expected end value of MIV to around $1 billion.
Mirvac reaffirmed its guidance of operating earnings per share of 14 to 14.3 cents in FY24, and distribution per share of 10.5 cents.
The context: Mirvac said the development at 55 Pitt Street will be delivered as a joint venture, with Mirvac co-owning, developing and constructing the building, and providing leasing, investment and property management services for the asset on completion.
Mirvac was one of the worst performing stocks across the ASX 200 on Thursday, after Morningstar slashed its fair value estimate for the property developer. Analysts anticipate ongoing pressure on development margins due to housing affordability issues limiting price growth and continued high construction costs.
The source: ASX announcement
