Stockland 1Q27 operational update: guidance maintained as residential sales slow
In its 1Q27 operational update for the three months ended 30 September 2026, Stockland (ASX: SGP) maintained FY27 funds from operations (FFO) per security guidance of 38.0 – 39.0 cents. Masterplanned Communities (MPC) net sales fell to 1,506 from 2,117 in 1Q26.
Investments, led by Logistics and Retail, remained resilient during the quarter, and the Data Centre pipeline grew to ~450MW of power secured. FFO is expected to be weighted to 2H given the timing of Data Centre transactions and MPC settlements.
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Investment portfolio performance in 1Q27
Logistics leasing momentum
Stockland recorded leasing spreads of 17.6% on new leases and renewals in Logistics, and the portfolio is 8% under rented, which the company says provides mark-to-market upside. Development completions and leasing activity drove an increase in weighted average lease expiry (WALE).
| Logistics portfolio | 1Q27 (3 months ended 30 September 2026) | 1Q26 (3 months ended 30 September 2025) |
|---|---|---|
| Leases executed | 121,199 sqm | 66,244 sqm |
| Leases under HOA | 122,283 sqm | 95,720 sqm |
Portfolio occupancy (by income, excluding Cherry Lane, VIC) eased to 96.9% from 97.5% at 30 June 2026. WALE rose to 3.9 years from 3.7 years.
Retail and Workplace
Retail delivered total comparable moving annual turnover (MAT) growth of +3.5%, with comparable specialty MAT growth of +4.3%. Comparable specialty sales were ~$11,300 per sqm, stable portfolio occupancy was 99%, and stable portfolio leasing spreads of 7.9% are expected to moderate during the year.
| Retail sales by category | Total portfolio MAT ($m) | Total portfolio MAT growth | Comparable centres MAT growth |
|---|---|---|---|
| Total | $5,253M | 5.5% | 3.5% |
| Specialties | $1,623M | 5.3% | 4.3% |
| Supermarkets | $1,790M | 8.0% | 3.1% |
| DDS/DS | $608M | 0.3% | 0.3% |
| Mini majors | $761M | 5.7% | 5.4% |
In Workplace, leasing spreads were 1.6% on new leases and renewals negotiated year to date. Portfolio occupancy (excluding Walker Street Complex and 601 Pacific Highway in NSW) was 84.2% and WALE 6.3 years, and Stockland disposed of 60-66 Waterloo Road, Macquarie Park.
On development, $0.2bn of Logistics assets were completed at Kemps Creek. A further $0.6bn of Logistics and $0.2bn of Retail projects are under construction, stated as forecast end value on completion.
Residential for sale and Land Lease results
Masterplanned Communities slow with the market
Stockland described interest rates and tax changes as slowing the market. MPC net sales of 1,506 reflected:
- Moderation of QLD demand, now slowing in line with the national market
- More balanced market conditions in WA, where demand is now matched by supply
- Affordability constraints in NSW impacting sales
- A VIC market that remained relatively stable at low levels
Reduced enquiry was partly offset by stronger conversion. The company recorded 828 settlements in the quarter, with 4,502 contracts on hand at average pricing above FY26 settlements, and cancellation and default rates remained below long-run average levels.
| MPC metric | 1Q26 | 1Q27 |
|---|---|---|
| Total net sales | 2,117 | 1,506 |
| Total enquiries | 36,551 | 10,452 |
In Apartments, planning approval was obtained for Victoria Parade, Collingwood, VIC. Stockland is progressing the Waterloo Urban Renewal site (3,300 apartments, ~50% residential for sale) and Stanton Place, Rosebery, NSW (144 apartments).
Land Lease Communities
Land Lease Communities achieved 206 net sales, which the company said reflected a lengthening of customer decision timeframes and softer established market conditions. Increased conversion partly offset lower enquiries.
Contracts on hand totalled 774, at average pricing above the FY26 average settlement price per home of $832,000. Stockland is actively trading from 17 communities, and portfolio occupancy remained at 100%.
The established portfolio comprises 4,025 home sites, including 2,604 within capital partnerships. Halcyon Peninsula (VIC) and Halcyon Grevillea (WA) are anticipated to launch during FY27.
Data Centres: what it means for investors
Data centres need large, reliable electricity supply, so the amount of power a site has secured is a key measure of its potential. Stockland reported ~450MW of power secured (subject to final design, documentation and customer negotiations), with four additional sites identified.
The pipeline is sourced from within the existing Logistics and Workplace portfolio, in partnership with EdgeConneX.
| Property/site | SGP interest | Current usage | Power secured | Target customer |
|---|---|---|---|---|
| MPark Stage 2, NSW | 100% | Workplace land | ~100MW | Cloud/Co-location |
| Cherry Lane, VIC | 100% | Logistics existing | ~175MW | AI/Hyperscaler |
| Brooklyn, VIC | 100% | Logistics existing | ~175MW | AI/Hyperscaler |
Kemps Creek, Wetherill Park and Macquarie Park were endorsed by the NSW Government Investment Delivery Authority.
On monetisation, an initial FFO contribution is expected in FY27 from land transfers and sales. Additional contributions are expected in future periods from further land transfers, development gains, fee income and net operating income (NOI).
For readers wanting to understand how the partnership is structured, our full explainer on the EdgeConneX joint venture covers the 50/50 capital sharing arrangement and how Stockland’s existing land portfolio provides site optionality for hyperscale development.
FY27 guidance and outlook
Stockland maintained its FY27 guidance and targets:
- FFO per security of 38.0 – 39.0 cents
- Distribution per security expected at 25.2 cents (in line with FY26), within a payout ratio range of 60 – 80% of FFO
- Gearing expected to remain within the 20 – 30% target range
Residential volume targets are unchanged. Stockland is targeting MPC settlements of 7,300-8,300 lots with a development operating profit margin of around 20%, and Land Lease settlements of 850-950 homes with a margin of above 22%.
All forward-looking statements, including FY27 earnings guidance, remain subject to no material change in market conditions.
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