New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<ul><li>After adjusting for a one-off lease surrender payment, Argosy's (ARG) 1H26 result was largely in line with expectations.</li><li>Divestment of non-core assets has been slower than anticipated, but better momentum is expected in 2H26/FY27.</li><li>Balance-sheet gearing of 35.9% rises to 38.3% on a committed basis, and we estimate non-core asset sales will provide just enough headroom to complete the Mt Richmond and East Tamaki Dr developments before any valuation uplift (ARG believes valuations have bottomed) and dividend reinvestment.</li></ul>

After adjusting for a one-off lease surrender payment, Argosy's (ARG) 1H26 result was largely in line with expectations.Divestment of non-core assets has been slower than anticipated, but better momentum is expected in 2H26/FY27.Balance-sheet gearing of 35.9% rises to 38.3% on a committed basis, and we estimate non-core asset sales will provide just enough headroom to complete the Mt Richmond and East Tamaki Dr developments before any valuation uplift (ARG believes valuations have bottomed) and dividend reinvestment.

<ul><li>Argosy's FY25 results were in line with expectations, with pressures from higher interest, tax, and one-offs in the prior period.</li><li>The company is executing a strategy to increase exposure to the industrial subsector by selling non-core office assets to fund industrial-development projects.</li><li>Despite trading at a discount to net tangible assets (NTA) and offering an attractive gross yield of 9.3%, flat distributions are forecast until FY30.</li></ul>

Argosy's FY25 results were in line with expectations, with pressures from higher interest, tax, and one-offs in the prior period.The company is executing a strategy to increase exposure to the industrial subsector by selling non-core office assets to fund industrial-development projects.Despite trading at a discount to net tangible assets (NTA) and offering an attractive gross yield of 9.3%, flat distributions are forecast until FY30.

Argosy FY25—Slowly Tacking into Stronger Winds

Equity Capital Markets

Precinct Properties New Zealand / Equity Capital Markets

<ul><li>The listed property sector was broadly flat in October after delivering a +18% total return year-to-date.</li><li>Precinct (PCT) raised NZ$325m of additional equity in the month, which weighed on sector performance as investors looked for funders, and the risk of further capital raisings weighed on sentiment.</li><li>Our analysis of the sector’s long-term development pipelines and potential funding options highlights a divide between those with access to capital (PCT, Goodman (GMT)) and those without, who may need to recycle non-core assets or tap into additional sources of capital to fund growth aspirations.</li></ul>

The listed property sector was broadly flat in October after delivering a +18% total return year-to-date.Precinct (PCT) raised NZ$325m of additional equity in the month, which weighed on sector performance as investors looked for funders, and the risk of further capital raisings weighed on sentiment.Our analysis of the sector’s long-term development pipelines and potential funding options highlights a divide between those with access to capital (PCT, Goodman (GMT)) and those without, who may need to recycle non-core assets or tap into additional sources of capital to fund growth aspirations.

Real Estate Reflections Taking a Breather

Thematic (Sector/Industry)

<ul><li>Falling short-term interest rates have swung sentiment in the listed property sector’s favour.</li><li>We have rolled the lower forward interest rate curve through our models and adjusted our NAV assumptions, which drives a +3% to +9% increase in sector target prices.</li><li>The NZ property sector rose +5.8% in September, outperforming the broader market, which was up +2.8%.</li></ul>

Falling short-term interest rates have swung sentiment in the listed property sector’s favour.We have rolled the lower forward interest rate curve through our models and adjusted our NAV assumptions, which drives a +3% to +9% increase in sector target prices.The NZ property sector rose +5.8% in September, outperforming the broader market, which was up +2.8%.

<ul><li>The NZ listed property sector has outperformed the broader NZ market, delivering a +6% outperformance versus a -4% decline in the broader market.</li><li>With asset values stabilizing and forward capital requirements modest, the use of dividend reinvestment plans (DRPs) is now less necessary, making share buybacks an attractive option.</li><li>The high yields in the property sector appear sustainable due to robust tenant demand, fixed rental increases, and reduced debt costs.</li></ul>

The NZ listed property sector has outperformed the broader NZ market, delivering a +6% outperformance versus a -4% decline in the broader market.With asset values stabilizing and forward capital requirements modest, the use of dividend reinvestment plans (DRPs) is now less necessary, making share buybacks an attractive option.The high yields in the property sector appear sustainable due to robust tenant demand, fixed rental increases, and reduced debt costs.

Real Estate Reflections Ahead at Halftime

New Zealand

Argosy Property Limited invests in and manages retail, commercial and industrial properties in New Zealand.

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Argosy Property (ARG NZ)

Argosy 1H26 Result—On Course

After adjusting for a one-off lease surrender payment, Argosy's (ARG) 1H26 result was largely in line with expectations. Divestment of non-core...

Forsyth Barr

Argosy FY25—Slowly Tacking into Stronger Winds

Argosy's FY25 results were in line with expectations, with pressures from higher interest, tax, and one-offs in the prior period.

Forsyth Barr

Real Estate Reflections Taking a Breather

Precinct (PCT) raised NZ$325m of additional equity in the month, which weighed on sector performance as investors looked for funders, and the risk...

Forsyth Barr

Real Estate Reflections Hot Property

We have rolled the lower forward interest rate curve through our models and adjusted our NAV assumptions, which drives a +3% to +9% increase in...

Forsyth Barr

Real Estate Reflections Ahead at Halftime

The NZ listed property sector has outperformed the broader NZ market, delivering a +6% outperformance versus a -4% decline in the broader market.

Forsyth Barr

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