Childcare centre landlord Arena REIT has weathered the challenges of the pandemic to deliver a 4 per cent increase in distributions for its 2020 fiscal year, after the federal government stepped in to support the sector.
Managing director Rob de Vos noted the “strong government response” as the coronavirus-caused shutdowns hit the sector nationally, and with a fresh lockdown introduced in Victoria to combat a second wave of the virus.
Rent relief provided by Arena to its tenants in response to the pandemic amounted to 4 per cent of contracted rent for the 2020 fiscal year. Of that total, 3.5 per cent was deferred, with much of it to be collected in the coming year. Just 0.5 per cent was abated altogether.
“Arena remains well positioned to navigate the ongoing and emerging challenges arising from COVID-19 and to consider new opportunities that are consistent with strategy and Arena’s investment objective,” Mr de Vos said.
Net operating profit rose 16 per cent to $43.8 million. Statutory net profit, boosted by property revaluations, rose 29 per cent to $76.6 million.
Arena delivered a 4 per cent increase in total distributions to 14??. It has given guidance for growth of 3-4 per cent for the 2021 year. Investors responded warmly, with the stock closing 12c, or 5.4 per cent higher, at $2.36.
Arena’s $914 million portfolio comprises 211 childcare centres and 17 development sites along with 11 healthcare properties. It booked a revaluation gain of $36.9 million, an increase of 4.6 per cent.