BUSINESS

Brookfield Property boosting distributions 6%, profit soars on higher values

02/04/2015 08:19 EST | Updated 04/06/2015 05:59 EDT
HAMILTON, Bermuda - The Brookfield group's main real estate holding will raise its quarterly distribution to investors by six per cent to 26.5 cents per unit, beginning with the March 31 payment.

The announcement by Brookfield Property Partners (TSX:BPY.UN) on Wednesday was consistent with its plan to increase annual distributions between five and eight per cent from the previous rate, which was US$1 per unit annually or 25 cents per unit for the quarterly payment on Dec. 31.

Brookfield Property also reported a huge jump in net income, which rose to US$1.5 billion in the fourth quarter ended Dec. 31 from US$190 million a year earlier — mainly due to gains in the fair value of its office and retail operations.

The limited partnership — which is headquartered in Hamilton, Bermuda, but has most of its holdings in North America, Australia and the United Kingdom — is part of a Qatari-Canadian group seeking to get control of London's landmark Canary Wharf complex.

It also owns a number of key office towers in major Canadian and American cities, as well as other types of real estate.

During the quarter, Brookfield Property leased 3.2 million square feet of space in its core office portfolio at rents that are 45 per cent above expiring leases, while occupancy improved to 92.1 per cent at the end of December.

Another key measure for the company, funds from operations, rose 30 per cent from a year earlier to US$190 million from US$146 million or 28 cents per unit. The company's office operations accounted for US$150 million of FFO, up from $78 million a year earlier.

Brookfield Property Partners is part of the group headed by Brookfield Asset Management of Toronto (TSX:BAM.A), which is primarily involved in property, renewable energy, infrastructure and private equity though numerous entities.

Brookfield Property units were up 46 cents, or 1.53 per cent, at $30.60 Wednesday on the Toronto Stock Exchange.