Rich lister Lang Walker’s developer profits up 30pc
Billionaire businessman Lang Walker has chalked up a 30 per cent lift in what he described as his real estate development company’s core operating business profit to $224 million in the last financial year, after raking in stronger sales, higher rental income and better earnings from hospitality.
Although all those revenue streams performed significantly better in 2023 than the previous year, company accounts show net profit tumbled from $675 million in 2022 to $81 million.
Lang Walker, owner of Walker Corporation.
Much of that difference between statutory profit and the underlying performance is explained by the swings and roundabouts of the accounting treatment of portfolio valuations.
Last year’s total revenue of $1.2 billion was bolstered by a $635 million valuation gain as Walker’s empire emerged from COVID-19 pandemic lockdowns, bolstered by low interest rates and as major projects, including at Parramatta Square in Sydney, were completed. This year, gains added just $78 million to statutory earnings.
Nevertheless, with some major commercial property owners around the country recording write-downs against assets, Mr Walker said the valuation uplift, although small, was testament to the company’s strategy. Major projects have been undertaken at Parramatta Square and Western Sydney University Bankstown in Sydney, Collins Square in Melbourne, Festival Square in Adelaide and Maroochydore City Centre on the Sunshine Coast.
“The positive uplift in our assets valuations reflect their unrivalled location and premium A-grade status being ideally positioned off the back of major transport infrastructure,” Mr Walker said in a statement.
“Our growth has been supported by ongoing strong occupancy in our major commercial precincts, with Collins Square in Melbourne at 99.2 per cent and Parramatta Square now over 96 per cent occupied with final fit outs under way for major firms taking up space in the towers, including LG, Endeavour Energy, KPMG and the commonwealth government’s ATO and ABC well advanced.”
Development pipeline
The Walker empire stretches from office tower projects in Sydney, Melbourne and Adelaide to a 30,000-lot land bank of greenfield housing and 10,600 apartments. It has another 45,000 lots across three extensive housing estates under development at Johor Bahru in Malaysia, near Singapore, and a high-profile private island resort in Fiji, Kokomo.
In all, those opportunities amount to a development pipeline of medium-density housing and greenfield estates of $34 billion.
Financial results lodged with the corporate regulator show the billionaire, the sole shareholder of Walker Group Holdings, collected a $2.65 million dividend this year, down from a $3.65 million payout the previous year.
The accounts also show Walker Group’s balance sheet is in good shape, with $7.1 billion of investment property held on the balance sheet. That represents an increase of 7 per cent, courtesy of the completion of WSU Bankstown campus.
Total assets have increased by a further $700 million to more than $8.9 billion, and cash reserves are up 44 per cent over last year to $568 million, leaving Walker Group well positioned for the uncertain economic conditions.
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