Already a subscriber?Earnings at the country’s largest real estate groups will fall over the next 12 months with only a few “pockets” of value left for investors, according to brokers at UBS.
Mirvac’s chief executive, Campbell Hanan. UBS has pointed to the diversified property group as one of its picks for the year.ASX-listed real estate groups have been forced to write down some of their biggest assets over the last year. “Development is clearly challenging at present with higher build costs showing limited signs of abating, with the possible exception of Victoria where the economy is not supportive of new supply,” the note reads. “Revenue assumptions have not kept pace with higher costs and most developments are not feasible by 30 per cent.”
But Mr Bodor has pointed to one stock where investors may find more opportunities – Mirvac. Shares in the residential property developer and office landlord have fallen almost 19 per cent in the last year, giving the company a market capitalisation of nearly $7.4 billion. That is almost half the company’s value before the COVID-19 pandemic.