This property fund manager expects a 10pc earnings lift this year
Property fund manager Centuria has flagged a 10 per cent lift in earnings this year backed by the roll-out of new listed vehicles, after beating its own guidance in the past financial year.
Delivered by joint chief executives John McBain and Jason Huljich, Centuria’s outlook is one of the most bullish yet for a sector that has suffered more than most from high interest rates.
But the tide is turning in the ASX-listed fund manager’s favour as interest rates fall and investors press hard for better yields on their investments.
McBain said that in a world where “yield becomes an increasingly scarce commodity” Centuria’s real estate, equity and debt funds would prove increasingly attractive for investors.
“Wait until interest rates go another 25 or 50 basis points [lower],” he told The Australian Financial Review.
“All of a sudden, people are thinking, ‘Hang on, what was that last Centuria product? How much was that [yield]? I’m sorry, that’s full. We’ve got to wait for the next one’.”
Centuria hopes to bottle that enthusiasm in at least two new funds to be launched in the coming year, along with a listed credit fund and what it describes as “innovative new real estate funds”.
McBain is keeping his cards close to his chest on that front, while flagging examples of Centuria’s willingness to innovate and go into new sectors previously such as agricultural property funds.
More recently it has invested into ResetData, which deploys small-scale data facilities within existing buildings, using a unique liquid immersion cooling system, and provides AI and cloud services.
Underpinning Centuria’s confidence for the 2026 financial year is McBain’s view that real estate markets passed through the latest cycle’s “inflection point” – during which valuations, especially for office buildings, were under pressure. But as the cycle turns Centuria expects to accelerate its deal-making.
It has set a target of around $1 billion in real estate acquisitions in the coming year and is off to a flying start, acquiring a $216 million Port Adelaide logistics facility for its largest single-asset unlisted industrial fun so far.
Over the 2025 financial year, Centuria’s assets under management hit $20.6 billion. Around 30 per cent of that is held in two listed commercial property funds, along with a New Zealand-listed fund. The bulk of its platform is spread across an array of unlisted single property asset vehicles, open-ended funds and its Centuria Bass real estate finance business.
Huljich attributed the platform’s earnings momentum to new unlisted fund investment opportunities over 2025.
“Despite the ongoing impacts of higher interest rates, the group benefited from $800 million of equity inflows across investor capital raisings and institutional commitments,” he said.
As well, Centuria’s institutional partnerships across six counterparts total $2.2 billion of its assets under management, he said.
Over its 2025 financial year, Centuria lifted its operating profit 6.5 per cent to $100.8 million, boosted by higher earnings from funds management and property investment. Statutory profit fell 19 per cent to $82.7 million after taking into account changes in portfolio valuation.
Its operating earnings per security hit 12.2¢, 4.3 per cent above the previous year and beating its guidance for 2025. Distributions totalled 10.4¢, a 4 per cent increase on the previous year. Centuria has forecast at 10 per cent lift in operating earnings per security to 13.4¢, while holding distributions at 10.4¢.
