New Zealand Professional Investment Services Firm

Forsyth Barr

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.

New Zealand Professional Investment Services Firm, Forsyth Barr

Thematic (Sector/Industry)

New zealand Equity real estate investment trusts (reits) / Thematic (Sector/Industry)

<ul><li>Rising long-term bond yields continued to weigh on sentiment towards NZ listed property in September.</li><li>The sector is well hedged in the short term, which should cushion the immediate earnings impact, though rates remain a headwind to modest earnings growth forecasts.</li><li>We continue to see attractive value within the sector, trading on 16x 12-month forward AFFO and a 9.0% gross yield (33% taxpayer), a slightly wider premium to bonds than the historical average, and a -26% discount to NTA, though we acknowledge bond rates are firmly in control in the short term.</li></ul>

Rising long-term bond yields continued to weigh on sentiment towards NZ listed property in September.The sector is well hedged in the short term, which should cushion the immediate earnings impact, though rates remain a headwind to modest earnings growth forecasts.We continue to see attractive value within the sector, trading on 16x 12-month forward AFFO and a 9.0% gross yield (33% taxpayer), a slightly wider premium to bonds than the historical average, and a -26% discount to NTA, though we acknowledge bond rates are firmly in control in the short term.

Real Estate Reflections: Rising Rates Rule the Roost