August Monthly Newsletter

  • In August most listed companies in Australia reported their profit results for the six months ending in June. This period has arguably been the most challenging for real estate ever. At no stage during the 1992 recession or the GFC were large sections of the economy closed by the government and Australia’s borders effectively sealed. While the shopping centre trusts saw significant declines in earnings, many other property trusts were far less impacted from CV-19 than was feared during the dark days of March.
  • The Atlas High Income Property Fund gained by +5.3% in August, a pleasing outcome as many companies in the Fund reported stable earnings, paid distributions and were quietly optimistic for 2021. A common theme from reporting season was that business conditions have continued to improve since June, with tenants paying rent and new leasing deals being signed.  
  • In an environment where interest rates are close to zero, we see that in the near future, the market will re-rate property trusts that can deliver a stable stream of dividends to investors. What the August reporting season demonstrated was that real estate is not a homogenous asset, with some landlords seeing a minimal impact from CV-19.

Go to Monthly Newsletters for a more detailed discussion of the listed property market and the fund’s strategy going into 2020.