Softening cap rates in SCA Valuations
SCA Property Group announced the results of its property valuations as at December 2018. Fifteen of the properties were independently valued and the twelve properties acquired after June 2018 were also independently valued. The remaining 58 properties were internally valued.
On the like-for-like portfolio, the weighted average capitalisation rate softened by 4bps to 6.37% at December 2018 (6.33% at June 2018). Including the impact of the twelve acquisition properties (weighted average cap rate of 6.63%), the total portfolio capitalisation rate is 6.43% at December 2018.
Despite the slightly softer cap rates, the total value of investment properties increased by $699.3m to $3,153.1m.
The components of this increase were:
Like-for-like Australian properties valuation increased by $11.4m, or 0.5%. The increase is driven by an increase in like-for-like valuation NOI of 0.5%, offset by overall capitalisation rate softening of 4bps;
Valuation of development properties increased by $10.0m, comprising $7.8m from Shell Cove and $2.2m from Bushland Beach, reflecting $9.7m of capitalised development costs to date and fair value uplift of $0.3m; and
Acquisitions completed during the period added $677.9m, being Sturt Mall in Wagga Wagga, NSW (acquired for $73.0m), Miami One in Miami, QLD (acquired for $31.9m) and a portfolio of ten assets acquired from Vicinity (acquired for $573.0m).