Coronavirus: Property stocks vulnerable as forecasts dumped

Property stocks could again be hit as companies dump earnings guidance in the face of clampdowns caused by the coronavirus.

Supermarket landlord Charter Hall Retail REIT moved late on Friday, joining early-moving landlords Mirvac and GPT, which have pulled their guidance, along with shopping centre giants Vicinity Centres and Scentre, owner of the local Westfield empire.

Property stocks could again be hit as more companies dump earnings guidance in the face of clampdowns caused by the coronavirus.

Supermarket landlord Charter Hall Retail REIT moved late on Friday, joining early-moving landlords Mirvac and GPT, which have pulled their guidance, along with shopping centre giants Vicinity Centres and Scentre, owner of the local Westfield empire.

But two trusts run by APN Property, which own warehouses and petrol stations respectively, are retaining their distribution guidance, as they are in relatively protected sectors.

Peak shopping centre body SCCA on Sunday welcomed the Morrison government’s $66bn stimulus package and support for small to medium-sized businesses facing COVID-19 disruptions.

SCCA chairman, Scentre boss Peter Allen, flagged a focus on “mum and dad” small retailers and both financial and non-financial measures.

“We know small to medium-sized retailers are more vulnerable and our members are already working to help their retail partners at this exceptionally difficult time,” Mr Allen said.

Meanwhile, the Charter Hall-run vehicle blamed the uncertain environment and potential extended duration of the COVID-19 pandemic, as it pulled its fiscal 2020 earnings and distribution guidance.

Charter Hall Retail REIT said it was well-capitalised with no debt maturities until fiscal 2022, and over $150m in available liquidity through cash and undrawn bank lines.

“We continue to partner with our tenants to ensure our convenience-focused portfolio of supermarket-anchored centres remain open and fulfil their important role as providers of everyday and essential needs for our customers,” Charter Hall Retail chief executive Greg Chubb said.

APN also cited significant financial market volatility and broader disruption arising from the COVID-19 outbreak but stuck to its guidance for its defensively positioned vehicles.

The APN Industria REIT has 32 industrial and business park properties, is lowly geared and does not depend on development projects.

APN said a rapid economic slowdown was occurring and provisions had been taken against revenue forecasts for the rest of this financial year but it reaffirmed fiscal 2020 funds from operations per security guidance of 19.9c and distribution guidance of 17.5c.