Key Highlights

  • FFO increased 25.0% to $44.5 million, with FFO per security rising to 8.24 cents from 6.62 cents.
  • NTA per security increased to $1.21, supported by revaluations across the property portfolio.
  • Revenue from ordinary activities fell 6.4% to $77.0 million on lower funds management fees.
  • Company announced an on-market buyback of up to 5% of stapled securities alongside FY27 distribution guidance of 5.0 cents per security.

GDI Property Group (ASX:GDI) shares traded at $0.64 on 24 August 2026, up 2.40 percent, or 1.5 cents, in the session following the release of its full-year results for the year ended 30 June 2026. The movement came as the diversified property group reported Earnings growth alongside a newly announced buyback program. GDI reported Funds From Operations (FFO) of $44.5 million for FY26, an increase of 25.0 percent from $35.6 million in the prior year. FFO per security rose to 8.24 cents, up from 6.62 cents, a gain of 24.5 percent. The improvement was primarily attributed to growth within the Property Division, whose FFO climbed 14.8 percent to $58.4 million from $50.8 million, led by contributions from Westralia Square, WS2 and 197 St Georges Terrace.

Revenue from ordinary activities decreased 6.4 percent to $77.0 million, down from $82.3 million in the prior corresponding period, largely reflecting a $3.8 million reduction in funds management Revenue tied to a smaller asset base and the absence of non-recurring transactional fees recorded a year earlier. Net profit attributable to securityholders came in at $34.6 million, slightly lower than the $35.6 million reported in FY25, after accounting for net Fair Value gains on Investment properties of $3.4 million and on derivative instruments of $4.3 million.

The Funds Management Division recorded a 39.3 percent decline in FFO to $6.2 million, reflecting lower disposal and management fee income following the prior year's sale of 6 Sunray Drive in Innaloo. By contrast, the Co-living joint venture delivered FFO of $9.5 million, up from $6.5 million, aided by the Acquisition of Moranbah properties and improved performance across existing facilities.

Property Portfolio and Leasing Activity

During the year, GDI leased more than 20,937 square metres of lettable area through new leases, renewals and signed heads of agreement, lifting occupancy to 90.0 percent from 88.2 percent in the prior year. The company completed the sell-down of the Autoleague portfolio, with the final five Assets settling after balance date and delivering an internal rate of return exceeding 13 percent. It also completed the sale of two Bassendean properties for $29.5 million, representing more than a 170 percent premium to their 2014 acquisition price.

The Co-living joint venture expanded through the acquisition of three properties comprising 239 rooms in Moranbah, Queensland, for $18.3 million, along with the addition of 140 rooms in Norseman. WS2 also received recognition from the Property Council of Australia for its sustainable development credentials.

Balance Sheet and Debt Position

Gearing stood at 33 percent at year-end, down from 34 percent in the prior year, with GDI operating within its Syndicated Facility covenants. The Loan to Value ratio was 37 percent against a covenant of 50.0 percent, and Interest Cover stood at 2.4 times against a covenant of 1.5 times. Drawn debt on the Syndicated Facility was reduced by $21.0 million during the year, while the facility's overall size was increased by $25.0 million to $426.5 million, with maturities extended into 2028 and 2029. Approximately 80.1 percent of drawn debt on the facility remained hedged through Interest Rate caps and callable swaps to 31 December 2027.

Net tangible assets per security rose to $1.21 from $1.20, following revaluations of Westralia Square, WS2 and Mill Green, while the weighted average Capitalisation rate across the portfolio edged up to 6.8 percent from 6.7 percent.

Capital Management and Distributions

GDI determined a cash distribution of 2.50 cents per security for the six months ended 30 June 2026, bringing total FY26 distributions to 5.00 cents per security when combined with the interim payment made in February 2026. Post balance date, available Liquidity increased to $90.0 million, and the company announced an on-market buyback of up to 5 percent of its stapled securities, set to commence within 14 days. Management indicated that completing the full buyback may depend on further sales of non-core assets, of which the group holds more than $100.0 million.

Outlook

GDI has flagged an intention to pursue a cash distribution of 5.0 cents per security for FY27, subject to no material change in circumstances or unforeseen events, noting that part of any FY27 distribution may be paid out of capital. Future focus areas include progressing Stage 1A of the Mill Green Development, evaluating the development potential of two Perth CBD carparks, leasing more challenging assets across both the Property and Funds Management Divisions, and pursuing a change of use for the Broadmeadow property.

Conclusion

GDI's FY26 results reflect a period of earnings growth in its core Property Division, offset by a decline in Funds Management contributions and lower overall revenue. Alongside the improvement in FFO and NTA per security, the company has moved to sound Balance Sheet management through reduced gearing and extended debt facilities, while also returning capital to securityholders through both distributions and a newly announced buyback program. Attention now shifts to leasing progress, non-core asset sales and the delivery of the Mill Green Development as GDI works toward its FY27 distribution target.