The DXS result was a good one.

Segment revenues continue to grow, particularly the enlarged funds management arm, which has benefited from M&A (e.g. taking over the AMP property funds).

As such funds from operations continues to grow…

Occupancy continues to trade well, as higher incentives ensure spaces are kept filled. We regard that as the critical bit – taking a hit on rent renewals is a vastly better outcome than unoccupied floors.

In the above graph, we looked at individual stocks segment occupancy, below, we look at company aggregates when bundled into sectors. The two graphs together help get a sense of what’s happening industry wide. COF, DXS, and the office segments of GPT, MGR suggest that office occupancy rates remain reasonable, and that the “death of the office” has been exaggerated.

And cap rates have either tightened, or remained roughly the same.

Look through gearing has risen, through acquisitions, but remains at the bottom end of the target range (30-40%).

Guidance is for distribution growth of not less than 2%, and we continue to view the stock as reasonably priced.

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This document is based on information available at the time of publishing, information which we believe is correct and any opinions, conclusions or forecasts are reasonably held or made as at the time of its compilation, but no warranty is made as to its accuracy, reliability or completeness. To the extent permitted by law, neither Aequitas nor any of its affiliates accept liability to any person for loss or damage arising from the use of the information herein.

Please note that past performance is not a reliable indicator of future performance.

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