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>Kiwi Property Group (KPG) delivered 1H26 AFFO up +7% year on year, which was +5% ahead of our expectations, largely driven by lower maintenance capex and tenant incentives.</li><li>Despite a stronger first half result, KPG reaffirmed its FY26 dividend guidance of 5.6cps based on 90%—100% AFFO payout, suggesting a softer second half partly due to seasonally higher maintenance capex.</li><li>Land and non-core asset sales provide c.NZ$1bn of development and/or acquisition headroom (before revaluations and retained earnings).</li></ul>

Kiwi Property Group (KPG) delivered 1H26 AFFO up +7% year on year, which was +5% ahead of our expectations, largely driven by lower maintenance capex and tenant incentives.Despite a stronger first half result, KPG reaffirmed its FY26 dividend guidance of 5.6cps based on 90%—100% AFFO payout, suggesting a softer second half partly due to seasonally higher maintenance capex.Land and non-core asset sales provide c.NZ$1bn of development and/or acquisition headroom (before revaluations and retained earnings).

Kiwi Property Group 1H26 Result—A Busy Kiwi

<ul><li>Kiwi Property Group reported a -7% decline in FY25 adjusted funds from operations, with solid top-line rental growth offset by higher interest and tax.</li><li>Build-to-rent is leasing better than expected, but rents remain below feasibility, and retail sales are weak, leading to higher retailer occupancy costs.</li><li>While KPG offers an attractive yield and trades at a discount to net assets, consumer weakness, full gearing, and portfolio remixing remain headwinds to growth.</li></ul>

Kiwi Property Group reported a -7% decline in FY25 adjusted funds from operations, with solid top-line rental growth offset by higher interest and tax.Build-to-rent is leasing better than expected, but rents remain below feasibility, and retail sales are weak, leading to higher retailer occupancy costs.While KPG offers an attractive yield and trades at a discount to net assets, consumer weakness, full gearing, and portfolio remixing remain headwinds to growth.

Kiwi Property Group - FY25 Result—Working Hard

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%.

Precinct Properties New Zealand / Equity Bottom-Up

<ul><li>The NZ-listed property sector continued its run in August, having now outperformed the broader NZ market by +12% year to date.</li><li>Over the month, we downgraded Precinct and Winton from OUTPERFORM to NEUTRAL, with the former trading on a full but fair +8% premium to NTA, and the latter due to the residential downcycle.</li><li>We also upgraded SPG from NEUTRAL to OUTPERFORM on valuation grounds, given its discount to NTA, our conservative NAV, and its solid 9.3% gross yield.</li></ul>

The NZ-listed property sector continued its run in August, having now outperformed the broader NZ market by +12% year to date.Over the month, we downgraded Precinct and Winton from OUTPERFORM to NEUTRAL, with the former trading on a full but fair +8% premium to NTA, and the latter due to the residential downcycle.We also upgraded SPG from NEUTRAL to OUTPERFORM on valuation grounds, given its discount to NTA, our conservative NAV, and its solid 9.3% gross yield.

Real Estate Reflections Closing The Discount

New Zealand

Kiwi Property Group Ltd is a property trust that invests in, manages and develops a portfolio of diversified properties throughout New Zealand. The Trust's properties include office, retail and industrial properties.

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Kiwi Property (KPG NZ)

Kiwi Property Group 1H26 Result—A Busy Kiwi

Kiwi Property Group (KPG) delivered 1H26 AFFO up +7% year on year, which was +5% ahead of our expectations, largely driven by lower maintenance...

Forsyth Barr

Kiwi Property Group - FY25 Result—Working Hard

Kiwi Property Group reported a -7% decline in FY25 adjusted funds from operations, with solid top-line rental growth offset by higher interest and...

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 Closing The Discount

The NZ-listed property sector continued its run in August, having now outperformed the broader NZ market by +12% year to date.

Forsyth Barr

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