Qantas Airways Limited (ASX: QAN) shares are edging lower this morning. In early trade, the Qantas share price is falling 0.86% lower to $4.60. This comes amid reports the airline could be set to gain up to $500 million from the sale of land.
Numerous parcels totalling nearly 14 hectares are reportedly set to be sold. They’re situated in Sydney’s inner suburb of Mascot and some have been in Qantas’ hands since the 1960s.
Let’s take a closer look at today’s news of Qantas.
Land for sale?
The Qantas share price is failing to respond positively to news the airline could be planning to sell land in South Sydney’s industrial precinct.
According to The Australian, Qantas chief financial officer Vanessa Hudson said selling the land could help pay back some of Qantas’ debt.
Qantas reported net debt levels of $6.05 billion and a statutory loss (before tax) of $1.47 billion in its results for the first half of the 2021 financial year. The Qantas share price fell 1.96% after the company released its half-year results.
Hudson reportedly said some land values in Mascot are 4 times what they were 10 years ago. Despite this, around 40% of the 14 hectares is used for staff parking.
The property also houses the Qantas Mascot distribution centre. Qantas is said to be planning to lease the centre back from its future buyer.
Hudson was quoted by The Australian as saying:
One thing that stood out from the property review we did earlier this year was the amount of undeveloped and underdeveloped land we hold around Mascot… Given how Mascot has developed over that time, there’s a lot of value we can unlock by selling it…
The proceeds would be used to help us pay down the debt we’ve built up getting through COVID, which in turn means we can start reinvesting sooner in things like new aircraft, things that are core to our business.
The publication also stated Qantas may sell all the land, or just some, depending on the market’s reaction.
Qantas share price snapshot
2021 hasn’t been a great year for Qantas on the ASX, amid persisting lockdowns and travel restrictions.
Right now, the Qantas share price is trading around 5% lower than it was at the start of the year. However, it has gained around 32% since this time last year.