Precinct is a city centre specialist and long term owner of real estate.
Ranked in the NZX top 30, Precinct is the largest owner and developer of premium inner-city space in Auckland and Wellington.
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Sustainability at Precinct
Sustainability is an important part of Precinct's business activities
Best practice governance structures
Download Precinct's 2023 Annual Report here.
Frequently asked questions.
How can I invest?
We are a listed company and as such our shares trade on the NZ stock exchange. You can invest with us through your share broker or alternatively your bank may well provide a share trading service. Typically the difference will be that a share broker can advise you on the investment whereas the bank service is purely to execute your instructions.
Noted below are a selection of New Zealand share brokers and banks that provide share trading services.
Please be aware that we are not financial advisers and we recommend that you should contact a financial adviser before making investment decisions.
What is Precinct's dividend policy?
Recognising a dividend policy should optimise long term sustainable returns for Precinct’s shareholders, the Board reviewed Precinct's dividend policy in 2019. Accordingly, Precinct intends to transition towards paying out approximately 100% of Adjusted Funds From Operations (AFFO) as dividends, with the retained earnings being used to fund the capital expenditure required to maintain the quality of Precinct’s property portfolio.
Aligning dividends with AFFO is considered to be best practice in a global context for real estate entities. It is consistent with the objectives of the current dividend policy, but more explicitly adjusts for maintenance capital expenditure and incentives. AFFO best reflects the sustainable cash flow produced by our portfolio. The Board is of the view that this updated dividend policy will provide a stable long term profile, in line with executing Precinct's strategy. The updated policy will be phased in over the next two years and has been considered in relation to our FY20 dividend guidance.
Could you please explain if you are still a REIT from both a classification and tax perspective?
Precinct is generally considered to be a REIT by REIT only investors and by MSCI and S&P .
New Zealand does not have specific REIT legislation unlike many other jurisdictions, however qualifying real estate investment entities have the benefits of the tax benefits available to investors under the Portfolio Investment Entity (“PIE”) regime. Precinct is a listed PIE and therefore the 2010 change in structure from a unit trust to a company should not change Precincts status as a REIT.
New Zealand shareholders benefit from the tax deductions of the company and will have no further tax to pay on their dividends. A component of dividends is excluded income for tax purposes and the balance is imputed at the company tax rate of 28%.
Under the Global Industry Classification Standard (GICS) Precinct is also defined as an Office REIT with a GIC of 60101040. (Equity Real Estate Investment Trusts 601010).
To read more about the GICS: Click here
Do Precinct's dividends carry imputation credits?
Yes. Under the PIE regime, New Zealand shareholders benefit from the tax deductions of the company and will have no further tax to pay on their dividends. A component of dividends is excluded income for tax purposes and the balance is imputed at the company tax rate of 28%.
Can you explain what a supplementary dividend is?
A supplementary dividend is paid to non-resident shareholders to offset the amount of non-resident withholding tax (“NRWT”) that New Zealand companies are required to deduct from dividends paid to non-resident shareholders. A supplementary dividend is paid to ensure equitable treatment between non-resident shareholders and resident shareholders (whose dividends are not subject to NRWT).
There’s no disadvantage to Precinct or our shareholders, and non-resident shareholders don’t get a larger cash dividend than an equivalent New Zealand resident shareholder.
We recommend that you seek professional tax advice on your own situation should you require more information.