Hospitality Property Fund total distribution up 14.5%
Hospitality Property Fund CEO, Andrew Rogers said that "We are pleased with the results especially the trading levels that we achieved up to the end of March 2014."
Hospitality Property Fund (HPB‚ HPA) on Wednesday delivered a 14.5% growth in its distribution per combined linked unit to 174.80c in the year to June‚ exceeding its own forecasts.
The company said revenue per available room was boosted in December last year as many foreign dignitaries travelled to South Africa to pay tribute to late former president Nelson Mandela.
Rental income was up 19,6% to R426,2 million‚ the property fund said. Like-for-like rental income was up 13.3%‚ driven mainly by the higher average room rates.
Their Properties in Cape Town and Sandton continue to perform well, in particular The Westin Cape Town, the Radisson Blu Waterfront and the Radisson Blu Gautrain Hotel.
Hospitality Property Fund CEO Andrew Rogers, said that: "We are pleased with the results especially the trading levels that we achieved up to the end of March 2014."
"Subsequently, the effects of the public holidays and National Elections were felt across the country, and whilst business travel is slowly picking up in the major centers, public sector travel continues to lag," he said.
Net asset value per linked unit of R11.40 was achieved‚ up 4.1% from 2013.
Its overall occupancy was 61,4%, up 2,2% with average room rate (“ARR”) increasing 14,0% to R1,162 and revenue per available room (“RevPar”) growth of 16,5%.
Meago Asset Managers director‚ Thabo Ramushu‚ said the occupancy growth was strong but came off of a low base.
“The results were marginally ahead of guidance‚ but it must be noted that the performance was coming off a low base. The fund's occupancy and average room rates were ahead of the industry even though the hospitality industry as a whole has recovered since 2011‚” he said.
He was concerned that Hospitality faced difficult times in the near future.
“There are however headwinds going forward‚ like the loss of income from conversion of fixed income lease to variable lease for the Birchwood Hotel and also the re-negotiation of the Champagne Sport Resorts lease in 2016 which will result in further significant negative rental reversions‚” he said.
Hospitality said it has capital projects amounting to R160 million planned in 2015 including new facilities at key Sandton and Cape Town properties as well as investment to upgrade 167 rooms at the Birchwood and The Terminal Convention Centre.
The Fund’s portfolio comprises interests in 26 hotel and resort properties in South Africa had a book value of the portfolio was R4,8 billion at year-end, translating into a net asset value per linked unit of R11,40, up 4,1% from 2013.
