Vicinity is the result of Federation Centers merger with Novion property group. The combined group has $14.5 billion retail assets across regional, neighborhood and outlets and became the 2nd largest retail REIT after Westfield (WFD) and Scentre.
We keep an eye on these retail REITs as they give a good look through to underlying consumer spending patterns and health of the economy. A proxy to unemployment and inflation/cpi data.
Key ASX VCX Facts:
As of June 30 2016, total tangible asset per security is $2.59.
Weighted average interest rate 4% with 80% of debt hedged. 4 year debt duration
29% gearing but expect this trend up as it fulfill its development pipeline.
Portfolio weight average lease expiry of 5.8 years
Development pipeline of $3.1 billion note that to make up the income short fall during development phase, VCX recognizes lost income in its operating income.
Vicinity FY16 Guidance
EPS guidance of 19.1 cents
Dividend payout ratio of 90% to 95% of underlying EPS
Targeting $750m to $1b in asset disposals
Vicinity Dividend
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