Hospitality Property Fund gains 17.7% distribution growth

CEO Andrew Rogers says Hospitality Property Fund continued benefit from improving fundamentals in the South African hospitality industry in the six months to 31 December 2013.

Hotel-focused property group, Hospitality Property Fund‚ today posted 17.7% growth to 89.08c in its distributions per combined linked unit in the six months to end December.

The company said on Wednesday that this was 7.1% ahead of the published forecast.

Hospitality owns of a portfolio of hotel and leisure properties.

The A-linked unit distribution grew by 5% to 69.83c‚ in line with the fund’s distribution structure and forecast.

The distribution on the B-linked unit showed an increase of 109.5% to 19.25c compared with the previous corresponding period and was 44.1% above the forecast.

There was revenue per available room growth of 18.4% reflected by those properties in the portfolio that were subject to variable rental income. The fund outperformed the industry revenue per available room growth of 14.7%.

“The quality of Hospitality’s hotel portfolio was an important contributor to the strong performance‚ with our properties in Sandton and Cape Town‚ in particular‚ performing well‚” CEO Andrew Rogers said.

“All things being equal‚ the fund is on track to meet the forecast distributions for the remainder of the financial year.

"At the end of December 2013‚ we changed hotel managers at Mount Grace and signed a new lease at the Kopanong Hotel and Conference Centre‚ positioning these properties to trade to their potential.

“Specific capital investments to improve the facilities at strategically important properties‚ including the Westin Cape Town‚ Radisson Waterfront and Protea Edward‚ are key to ensuring that they maintain their appeal.

Hospitality’s portfolio of 27 properties is strategically well positioned to benefit from a continued improvement in trading across the hotel industry‚” Mr Rogers said.