(Adds CEO quote, context, and detail of sector results)
SYDNEY, Feb 22 (Reuters) - Australian diversified real estate investment trust Stockland Corp Ltd posted a 7.8 percent rise in underlying earnings after record turnover in its residential business, especially from the booming east coast.
Stockland said funds from operations, which it added replaces underlying profit as its primary earnings metric, rose to A$369 million ($283.4 million). The company said it was tracking toward the upper end of its guidance for FFO growth per security of 5-7 percent.
“The business is benefiting from continued strong price growth on the eastern seaboard and is strongly positioned for the full year,” Stockland said in a statement to the Australian Securities Exchange.
Australia’s real estate market has been on a tear since mid-2012, and prices continue to rise, especially in the nation’s most populous cities of Sydney and Melbourne.
Across the country home prices grew at an annual pace of 10.7 percent in January, and 16 percent in Sydney, property consultant CoreLogic showed earlier this month, boosting the fortunes of landlords across the country.
Chief Executive Mark Steinert told Reuters by phone that although some project delays meant Sydney sales had lagged, favourable market conditions in Queensland and Melbourne pushed overall residential settlements to record levels.
“The most profound thing that we’re seeing is clear evidence of a broadening of economic growth in Australia,” he said.
Yet there are some hints that the soaring market may finally be approaching a peak. On a statutory basis, Stockland’s profit was flat, as recent big gains booked from property revaluations slowed down.
Australia’s Dexus Property Group reported a fall in statutory profit, as its gains from revaluations were more modest than a year ago.
And the number of new building approvals and residential properties listed for sale are both down from where they were a year ago.
Nevertheless the market remains strong, and underpinned a 17 percent property rise from developer Mirvac Group last week, while on Tuesday the nation’s biggest retail landlord, shopping centre giant Scentre Group, lifted its full-year earnings 10.4 percent thanks to extra revenue from redeveloped centres.
Stockland also announced an interim dividend of 12.6 cents, higher than 12.2 cents a year ago.
Australia’s ($1 = 1.3023 Australian dollars) (Reporting by Tom Westbrook; Editing by Hugh Lawson and Sandra Maler)