Archive | Archive – world property

World property W15Oct14 – Mirvac buys Birkenhead Pt, NAB adds UK asset manager, Scotland replaces stamp duty, Sovereign funds trade in London

Mirvac buys Birkenhead Point
NAB buys into UK manager Orchard Street
Scotland replaces stamp duty
Norges Bank buys $1.2 billion London building from GIC

Mirvac buys Birkenhead Point

Birkenhead Point, Sydney.

Birkenhead Point, Sydney.

Mirvac Group has entered into an agreement to acquire the Birkenhead Point Shopping Centre at Drummoyne, 5km from the Sydney cbd, including the adjoining carparking facility & marina, for $A310 million.

CDL Hotels NZ Ltd (now Millennium & Copthorne Hotels NZ Ltd) sold Birkenhead Point to Intro International Ltd (Denis Jen) in 2004 for $120 million. It had been an asset of Kingsgate International Corp Ltd, controlled by CDL & Tai Tak Securities Pte Ltd.

Abacus Property Group & the Kirsh Group bought it in 2010 for $A174 million and upgraded the retail offer into a convenience-based shopping centre & fashion outlet centre. The 187-berth marina was in the final upgrade stages.

Mirvac said its purchase, expected to be completed in November, represented a fully let passing yield of 6.6%.

The 3.7ha waterfront site has a gross lettable area of 33,100m² and parking for 1395 cars. Moving annual turnover is $A228.5 million at $A8082/m².

Link: Mirvac Group

NAB buys into UK manager Orchard Street

National Australia Bank’s global asset management business, NAB Asset Management, has bought a majority stake in UK specialist commercial property investment manager Orchard Street Investment Management LLP from the existing partners.

The bank has 12 other global asset managers operating in all major asset classes, managing $A178 billion in 50 investment strategies.

Orchard Street has grown its assets under management from £800 million to £4 billion in 10 years.

Scotland replaces stamp duty

A new land & buildings transaction tax will replace stamp duty in Scotland next April, and Property Wire editor Ray Clancy said at the weekend he expects this to herald change in the rest of the UK.

The starting threshold is £135,000, up from the stamp duty threshold of £125,000. A marginal tax of 2% will apply to the proportion of a transaction between £135-250,000, a 10% rate will apply between £250,001-1 million and there will be a new 12% tax on properties costing more than £1 million.

The Scottish Government’s Cabinet Secretary for Finance, Employment & Sustainable Growth, John Swinney, announced the rates & bands for the tax last Thursday, as part of the draft budget for 2015-16. The proposed rates & bands are subject to parliamentary approval.

It’s the first tax created by a Scottish parliament in 300 years.

Links: Scottish Government, land & buildings transaction tax
Property Wire, Property tax set for major change in the UK

Norges Bank buys $1.2 billion London building from GIC

The Bank of America Merrill Lynch Financial Centre, London.

The Bank of America Merrill Lynch Financial Centre, London.

Norway’s state-owned investment fund based on oil royalties, Norges Bank Investment Management, bought a 54,350m² London office complex (at left, aerial shot above) for £582.5 million ($NZ1.182 billion) cash last week from the Singapore Government’s sovereign wealth fund, GIC.

GIC bought the property from Merrill Lynch & Co Inc in 2007 for £480 million.

The property, the Bank of America Merrill Lynch Financial Centre at 2 King Edward St, is a freehold office campus consisting of 4 independent office buildings occupying a 1.3ha site. It’s fully leased to Bank of America Merrill Lynch, which will continue to manage it.

The Norwegian fund also bought a 50% interest in a 42,000m² Dutch logistics property last week, through its joint venture with US company Prologis.

Norges paid €12.4 million, again with no debt financing, for the building in Born.

Link: Norges Bank Investment Management

Attribution: Mirvac, Abacus, NAB, Orchard St, Scottish Government, Norges Bank

Regular leads: Europe Real Estate, Mingtiandi, Planetizen, World Property Channel

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Snapshot on world property, week to 27 November 2011

Contents:

 

Centro survives

Latest from RICS internationally

 

23 November 2011:

 

Centro survives

Centro Property Group got the overwhelming votes it needed yesterday from lenders & convertible bondholders to stay in business. The lenders voted 100% in favour after 28% abstained, and the bondholders were just under 100% in favour of the scheme of arrangement which will see securityholders – 26,000 mostly small; investors with an average holding of around 37,000 securities – get A5.03c/security.

They stood to get nothing if the scheme wasn’t approved and the 2 Centro entities, Centro Property Trust & Centro Properties Ltd, were forced into receivership. The outcome is that all the assets will go to the renamed Centro Properties – Central Retail Australia – which will be owned by its secured lenders in exchange for the cancellation of debt.

The scheme still needs the approval of the NSW Supreme Court, which Centro’s former auditor, PricewaterhouseCoopers, said on Monday it would challenge.

The group was one of the major Australian property casualties of the global financial crisis and has been struggling to stay alive since the end of 2007. It sold its US assets in February for $US9.4 billion but was still not going to be able to meet its debt obligations.

It had negative equity of $A1.3 billion at 30 June this year and $A2.9 billion of debt maturing on 15 December – now cancelled, if the scheme gets court approval.

The scheme was faltering until late last week, when $A90 million of debt was found to offer to shareholders, winning over the largest external shareholder, Marathon Asset Management.

The new-look listed property trust will own 43 Australian shopping centres worth $A4.4 billion. Combining that with its syndicate business, the group will have assets of $A7 billion.

 

Latest from RICS internationally

The RICS (Royal Institution of Chartered Surveyors) global real estate weekly updates, which I was having trouble connecting to initially, can be reached from this link: RICS, grew.

Want to comment? Go to the forum.

 

Attribution: Compiled & story written by Bob Dey for the Bob Dey Property Report.

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Snapshot on world property, week to 6 November 2011

Contents:

 

RICS weekly update at foot of page

Simon files case against home state for not collecting net sales tax

Goodman wins China award, has 5 new Chin projects underway

Goodman European Logistics Fund launches rights issue, group starts 3 new European projects

New Woolworths chief ponders property float, Dick Smith options, multi-channel retailing

Valad resumes growth under Blackstone ownership

RICS weekly update

 

6 November 2011:

 

The Snapshot on world property is, I think, a more effective way of letting you know about many overseas property events, succinctly, rather than trying to put a handful of them into “proper” story format… and losing the lot because I don’t have time to do that.

It’s been in abeyance since February 2004, along with most of the other Snapshots, when numerous changes were made to The Bob Dey Property Report.

 

RICS weekly update at foot of page

 

Introduced this week, at the foot of the page, is the weekly update on world property news from RICS (the Royal Institution of Chartered Surveyors; New Zealand fits into the Oceania branch of it).

 

Simon files case against home state for not collecting net sales tax

 

Simon Property Group Inc took up the battle of bricks-&-mortar retailers against internet sales on Thursday by filing a complaint against its home state of Indiana for not collecting sales tax from Amazon on sales made within the state.

Simon, biggest retail real estate owner, developer & manager in the US, filed its complaint against the state in the Marion County Circuit Court. The company said it wasn’t seeking monetary damages, but “to benefit all of Indiana’s taxpayers and the state’s bricks-&-mortar retailers, many of which are Simon’s tenants at its 27 shopping centres in Indiana….

“Amazon.com is required by Indiana law to collect & remit sales & use taxes to the state, for sales made over the internet, but has consistently refused to do so even though it is required by current Indiana laws.”

 

Goodman wins China award, has 5 new Chin projects underway

Goodman Group was awarded the Westpac business excellence award for large companies at the end of October for its performance in greater China. The company entered the China market in 2005 and has $US2 billion invested in the region.

It’s become one of the largest industrial landlords in Hong Kong, with a portfolio of about 900,000m² with a value of $US1.3 billion. Its latest development project, Interlink, is due for completion in January and is the largest industrial development in Hong Kong for over 10 years, offering 223,000m². It’s also the first building of its type to be awarded both a LEED certification and the HK BEAM Gold standard certification. In mainland China, Goodman owns & manages a portfolio of 7 warehouse & distribution facilities, with a combined value of $US215 million. Over the last 12 months, Goodman has also started 5 new development projects with a total estimated completion value of $US255 million. Goodman has a 2 million ft² (186,000m²) China land bank capable of delivering 1 million ft² of prime warehousing space.

Goodman European Logistics Fund launches rights issue, group starts 3 new European projects

The Goodman European Logistics Fund launched a €400 million underwritten rights issue last week and an €800 million debt refinance package, ensuring the fund maintains its gearing below 40%. It will refinance €400 million of secured facilities and have a €400 million unsecured facility structured to allow the fund to transition to debt capital markets to diversify its long-term funding sources. Goodman Group chief executive & fund investment committee chairman Greg Goodman said the refinancing would also provide about €500 million of investment capability, giving the fund capacity to increase gross assets to €2 billion and improving financial flexibility. The fund is continental Europe’s largest unlisted logistics fund, with €1.6 billion of logistics assets under management and a weighted average lease term of about 5 years. In the last 3 weeks, Goodman has announced planning consent for a 12,000m² facility at its Thurrock commercial park in Essex for A&N Media, which will invest £50 million in the new plant; a 78,000m² logistics centre for e-commerce retailer Zalando at the Erfurt freight terminal in the centre of Germany, pre-leased on a 16-year term; and a 45,000m² design-build facility in Hanover for Volkswagen Commercial Vehicles – Goodman’s ninth German development this year.

Link: Goodman

New Woolworths chief ponders property float, Dick Smith options, multi-channel retailing

Woolworths Ltd’s new chief executive, Grant O’Brien, mentioned a float of the group’s multi-billion-dollar property portfolio in a wide-ranging investor briefing in Sydney on Wednesday.

The property float wasn’t mentioned in company releases and didn’t extend to more than 2 paragraphs in news stories from the briefing. Mr O’Brien raised it alongside a strategic review of the Dick Smith consumer electronics business, Woolworths’ intention to become Australia’s leading multi‐channel retailer and the opening of 61 new stores this year (a net 44 after closures to a total 117).

Mr O’Brien said he’d report further on the Dick Smith review at its half-year results in February. “Consumer electronics as a retail category has been experiencing significant challenges, particularly in relation to tightened customer spending on discretionary products, category deflation and the effects of the high $A.”

Dick Smith operates 386 stores in Australia & New Zealand, with 2011 sales up 4.2% to $A1.86 billion but ebit down 14.9% to $A26.8 million.

On becoming Australia’s leading multi‐channel retailer, Mr O’Brien said: “We are really seeing a revolution in retail as customers integrate mobile, social networking and other internet‐enabled technologies into their bricks & mortar shopping experience. It isn’t a question of online or offline, it’s about integrating the 2 seamlessly, and we are increasingly finding that our most valuable customers are ones who do both – for example, in our supermarkets business, customers who shop both in‐store & online spend 70% more than customers who only shop in‐store.”

Link: Woolworths

Valad resumes growth under Blackstone ownership

 

Valad Property Group – listed on the ASX until its takeover by Blackstone Real Estate Advisors LP in August – said on Friday it had bought a 6011m² light industrial park just north of Paris for €6.1 million for its Parc d’Activités fund, which invests in multi-let industrial estates, mostly in the Ile-de-France area. Valad’s 42 properties in France, worth €500 million, are held in 4 of its 15 funds.

Valad Property Group manages $A9 billion of property in 7 geographic regions, through 23 offices in 13 countries. Its core business is value-adding real estate, specialising in multi-let commercial & industrial property, with local asset management teams taking care of about 8500 tenants in 900 properties.

2 affiliates of Blackstone Real Estate Advisors completed their acquisition of Valad’s securities on 26 August 2011. The $A1.80/stapled security price was 56% above the closing price before Blackstone’s offer was launched, but about 33% below net portfolio value.

Valad’s results for the December 2010 half showed its predicament – gearing up to 51.3%, lenders willing to extend its $A200 million facility to the end of 2012 but an $A51 million net loss for the period.

 

Link: Valad Property Group

 

RICS weekly update

 

In this week’s edition, the RICS global real estate weekly focus is on:

Australian monetary policyEuropean monetary policyUS construction spending and new housing initiativesUK construction sentiment

Link: What’s new on RICS Global

Want to comment? Go to the forum.

 

Attribution: Compiled & story written by Bob Dey for the Bob Dey Property Report.

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Snapshot on world property, September 2000

30 September 2000

Hong Kong’s Mass Transit Railway Corporation lists next Thursday after Hong Kong’s most heavily subscribed float yet. Three of the biggest local developers, Li Ka-shing and the Cheung Kong group, Henderson Land and Sun Hung Kai Properties, subscribed for a total 13% between them in the company, of which 20% has been offered to the public in the first tranche.

Hong Kong property developer Sun Hung Kai Properties reported a $HK10.8 billion profit in the year to June, up 17%.

Lend Lease Corporation and the East Asia Property Group have sold the almost-completed 49,000m² Aurora Place tower in Sydney to the Commonwealth Bank’s Commonwealth Property Investment Trust for $A485 million. The trust takes over responsibility for the 20% of leasing yet to be done and the $A35 million of incentives to tenants. Fully leased completion value is put at $A520 million. The trust raised $A350 million of equity from eight investors and super funds.

Dutch investor Rodamco will become the third largest mall owner in the US after agreeing to pay $US3.4 billion, a 25% premium over market price, for Urban Shopping Centers of Chicago. One beneficiary is likely to be Westfield America, which has been trading at a 9% discount.

29 September 2000

Keep up with the play and keep your staff happy, says Equity Office Properties Trust. Proud to have been ranked 13th in a top-25 list of the best places to work in Chicago, the biggest property owner in the US is also rated by BusinessWeek magazine as one of the top 50 companies “transforming inspiration and new resources into gold.” As landlords race to retrofit, Equity Office rates ahead of everyone in providing web access, equipping all 381 of its buildings with two or more high-speed internet providers. Small and midsized tenants make up 75% of the trust’s rent roll.

28 September 2000

Japanese general contractor Hazama has won agreement from its bankers to forgive one-quarter of its debt — up to ¥100 billion. Hazama still has a way to go to survive — its debt is 139 times equity. Big international contractor Kumagai Gumi has asked its bankers to forgive ¥450 billion of debt and Osaka builder Daisui sought forgiveness this week for ¥64 billion of debt.

The Hong Kong Government’s fourth residential site auction this financial year, on 5 October, will be an effective gauge of the city’s property market, with three sites expected to return up to $HK1.8 billion. Analysts have priced the biggest lot, 275,881ft² with a floor-area ratio of 3:1, at $HK3300-3900/ft².

CapitaLand, the company formed out the takeover of DBS Land by Pidemco,s both controlled by the Singapore Government, has downgraded the role of DBS Land president Ed Ng, headhunted only in April. He’ll now head the group’s commercial and property fund management units. Most of the board are from the Pidemco side.

25 September 2000

Jurong Town Centre in Singapore has a $S1 billion, 35ha industrial park on the drawing board at Tampines South for the manufacture of thin-film transistor liquid crystal displays. It is near two wafer-fabrication plants. All sites in Jurong’s 125ha Tuas View Pharmaceutical Park 1 are committed and 200ha of reclaimed land will be turned into a second pharmaceutical park. The fourth phase of reclamation at Jurong Island will add 550ha for the chemical industry, including an integrated logistics hub. Jurong is also working on a logistics park at Changi.

20 September 2000

Australian builder Multiplex has won the contract to redevelop Wembley Stadium in London, within a fortnight of its joint bid with Bovis Lend Leases being rejected. The joint venture started at £390 million, dropped back to £347 million but was still far too high. Multiplex came in alone at £326.6 million. It’s a similar scene (on a grander scale and without the joint venture), to Multiplex’s New Zealand entry, where the locals turned down a deal with Andrew Krukziener for his Metropolis tower, Multiplex accepted the price and has quickly gone on to become a significant force.

Macquarie Direct Property has bought two North Sydney office blocks, one from the BT Office Trust, for $50 million for its sixth syndicate. The deals were at 10.75% for the BT property, which has a 2003 lease expiry, and 9%.

19 September 2000

Maroochy Shire Council has rejected a Forrester Kurts master plan for an $A250 million, 310ha subdivision north-west of Coolum on Queensland’s Sunshine Coast, called Peregian Springs, raising environmental concerns. Forrester Kurts had cut the number of proposed lots from 3600 to 1700.

15 September 2000

A newcomer in Australian property, First State Developments, will pay $A19 million for the 91ha Wise family farm at Maroochydore on Queensland’s Sunshine Coast after an $A1 billion mixed-use deal fell over.

It’s kumara-sucking time at the movies: After Force Corp announced its $7 million loss for the year, the Australian trust that no longer wants to buy its Force Entertainment Centre on Auckland’s Queen St, the MTM Entertainment Trust headed by former St Lukes Group managing director Andrew Bennett, has declared an $A29.6 million loss. Its main tenant, Cinema Plus, was placed under statutory control and Imax took over operations in Australia. Force has conditionally taken over the Imax lease in Auckland. Valuations of three of its Australian properties were halved.

13 September 2000

Ariadne Australia has trebled profit in the June year to $A3.18 million after bumping sales up from $A31 million to $A67 million. Ariadne had a one-third stake in the new Sebel in Noosa, where 112 units were sold off the plans for $A72 million in January last year.

Daikyo sold the Gold Coast International Hotel to interests associated with a former director seven years ago for $A85 million, and has bought it back for $A46 million. Daikyo is a condominium developer in Japan and $A1 billion investor in Australia. Its latest deal rates the 296-room hotel at $A155,405 a room.

12 September 2000

Equity Office Trust has bought the World Trade Centre East in Seattle for $US38.7 million, of which about $US½ million is cash. The trust will pay down $US31.3 million in debt, and issue units for the rest to the World Trade Centre company. The six-storey, 17,370m² building has one tenant, a Microsoft company, and is part of a three-building complex. Its basement parking is owned separately by the Port of Seattle.

8 September 2000

Sun Hung Kai Properties has won the phase 2 development contract for the Kowloon Station area on Hong Kong’s airport railway line with an $HK6.8 billion bid. Shops, offices, flats and hotels are being built along the rail link. Sun Hung Kai also won phase 3 and is eyeing 20ha of reclaimed land beside Kowloon Station for a $HK25 billion development. That reclaimed area is a fraction bigger the Auckland’s former central railyards.

Singapore Government-controlled Pidemco Land has paid $S140 million for 11 floors of Shinjuku Square Tower in Tokyo, after entering the Japanese market with a residential investment. Pidemco says Tokyo commercial land prices have halved since the early 90s, but rents and occupancy rates started rising six months ago. This deal gives Pidemco 11,150m² (120,000ft²) at $S12,556/m².

Shell Oil and the P & O shipping line will turn the former Shell Haven refinery in Essex into Britain’s largest container port, covering 600ha and creating 10,000 jobs to handle up to 3.5 million 20ft equivalent units (teus) a year. Britain’s biggest container port, at Felixstowe, is owned by Hutchison Whampoa and handles 2.7 million teus a year.

Logistics company Strang International will build a speculative $A90 million, 25,000m² of office space in two 10-storey towers near Sydney’s Kingsford Smith Airport at Mascot. It is 150m from the new Mascot station, next to Qantas’ headquarters and has two international hotels, the Parkroyal and Ibis, as other near-neighbours.

MTM Funds Management, headed by former St Lukes managing director Andrew Bennett, says it has legal advice that 75% support instead of the usual 50% will be needed to remove it as manager of the MTM Office Trust. Kerry Packer-controlled Cavalane holds 23% and ANZ Bank 30% of the trust, which would otherwise have been enough to tip management over to James Fielding Investments, set up by Paladin founder Greg Paramor and Rod Leaver.

New South Wales Supreme Court judge David Hodgson has found no grounds to wind up Exben, the holding company of Transfield Holdings. Marco Belgiorno-Zegna is trying to get his share out of Transfield, ending a family feud between him, his father Franco Belgiorno-Nettis and his brothers.

4 September 2000

UK airports are on the move, out of the hands of their short-term private owners. National Express’ desire to get rid of its two airports, East Midland and Bournemouth, has been widely known for months but the company is expected to take them to auction with a price target around £200 million. Stagecoach iz said to be looking for a buyer for Prestwick in Scotland, FirstGroup wants to sell its 51% of Bristol International and TBI, an airports and property group, is a takeover target.

Rank Group will be left with the Hard Rock Café franchise, a film copying business and its British gaming subsidiary, headed by Mecca Bingo, after the expected sale of its 85-pub Tom Cobleigh chain to private equity company Electra Partners for £90 million. Rank has already sold its Odeon cinema chain, nightclubs, Pinewood film studios, and its half of the Universal Studios theme park in Florida. Sale of Rank’s British holiday business to Bourne Leisure Group for £500 million is well advanced. Among its assets is the famous Butlins chain, nowadays a struggling lossmaker.

2 September 2000

The Stockland Trust Group has bid $A1.73 for Advance Property Fund, 9c more than Mirvac. St George Bank said it would sell its 19% to Stockland, collecting 5% of Stockland and $A35
million in cash if the deal succeeds. Mirvac has not expressed a view on its next move.

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Snapshot on world property, week to 14 January 2001

Latest: Sino Land placement, Weingarten goes shopping, intelligent home technologies venture, Lafarge bids for Blue Circle.

10 January 2001

Sino Land has arranged a placement of 180 million shares at $HK4.35, an 8.4% discount on the market price yesterday, and could place a further 90 million shares to raise a total $HK1.17 billion ($NZ337 million). Its previous equity-raising, in April 1999, was at $HK4.63 for $HK1.55 billion. Sino Land is 23% geared, 46% including associates’ debt. Other Hong Kong property listeds — Cheung Kong Holdings, Sun Hung Kai Properties, Amoy Properties and the Wharf group — have all raised significant amounts of debt over the past month, some for refinancing, some for new development projects.

Houston-based Weingarten Realty Investors spent Christmas buying three shopping centres and two industrial properties in Texas and Las Vegas for about $US80 million, with considerable development potential on one. The nearest I can get to a return on this reit’s performance is an annualised 15.3% rental return (15.9% total return) on the third quarter portfolio, which stood at $US1.66 billion, an annualised 5.6% return on total assets, and an annualised 12.6% return on shareholders’ equity. Weingarten now has 197 shopping centres and 55 industrial properties.

9 January 2001

British construction company Taylor Woodrow plc has joined control and automation systems specialist Invensys plc in an initial one-year venture to design and develop a range of intelligent home technologies intended to improve lifestyles. The model homes they plan to build this year will have centralised remote access to appliances, heating and other systems through the internet. “This agreement is the first step toward widespread commercialisation of what we call the internet lifestyle,” said Jim Devlin, president of Invensys Home Control Systems’ product group.

8 January 2001

French building materials company Lafarge SA’s £3.1 billion ($NZ10.3 billion) bid for Blue Circle Industries plc of Britain will be a friendly one, with details out in the next day. Last year its unfriendly bid was spurned. Lafarge got 22.6% of Blue Circle last year at 450p, 10% less than the expected bid price this time.

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Snapshot on world property, week to 12 August 2001

Latest: Mirvac sells all but one of Promontory, Macquarie CountryWide profit up 22%, Leighton and Fielding join in investment, Ariadne warns of $A6 million loss, Lend Lease takes control of Suncorp retail property fund, Macquarie Office profit up 23.4%, HK land authority to sell $HK250 billion landbank, Keppel profit up 21%, ING balance sheet strong as it expands, Deutsche doubles profit, Equity Office up 11.4% on 33.5% revenue rise, $US45 million Dairy Farm hit hurts Jardine, Babcock & Brown takes control of MTM Entertainment.

12 August 2001

Mirvac Group secured 81 sales worth $A115 million in the first weekend of marketing its Promontory apartment development on Sydney’s Pyrmont peninsula, leaving just one unsold unit. Prices ranged from $A800,000 for a two-beddie, up to $A3.5 million for a penthouse. More than 40% were secured by previous Mirvac customers. The apartments, under construction, are due for completion in the first half of 2003.

Food-based retail property investor Macquarie CountryWide Trust increased operating income 22% to $A59.2 million in the June year, on net income from ordinary activities also up 22%, to $A38.2 million. Net tangible assets rose 5.9% to $A1.25/unit, and total assets rose 38.4% to $A663.4 million, including the $NZ83.5 million purchase of 13 Progressive Enterprises supermarket sites in New Zealand. Other acquisitions were six in Australia for $A49 million and five in the US for $US36.8 million in a 75:25 venture with Regency Centres. CountryWide owns 90 supermarket-based shopping centres. Its gearing fell from 31.1% to 29.9%. From New Zealand it got $A2.6 million profit from $5.13 million income on $A67.5 million assets, from 13 September 2000.

Leighton Holdings Ltd, the James Fielding Group (Greg Paramor & Rod Leaver) and PA Property Trust have formed an alliance to pursue property investment opportunities. James Fielding subsidiary PA Property Management Ltd manages the PA trust, in which Leighton has taken a 15% stake through a placement, raising $A8.349 million. In return, the trust has completed purchase of phases 1 & 2 of Leighton Properties’ Mulgrave development in Melbourne for $A14.65 million.

Ariadne Australia Ltd expects to report an $A6 million operating loss before and after tax for the year to June. Executive chairman Kevin Seymour blamed King’s Parking’s troubles — doubling of the Sydney parking levy, gst, the Olympics and higher petrol prices — the costs of exiting some long-term projects, and the court appeal costs relating to its Noosa Hill joint venture with Leighton Holdings Ltd. Mr Seymour said Ariadne should return to profit this year.

The Australian Prime Property Fund Retail, a wholesale fund managed by Lend Lease Real Estate Investments Ltd, has bought more than 90% of the $A486 million net asset Suncorp Metway Retail Property Fund. Suncorp Metway will take up to 25% of APPF, which will become Australia’s biggest unlisted wholesale specialist retail property fund with $A1.1 billion of assets — two wholly owned shopping centres and six 50% stakes. On completion of the transaction, APPF Retail will have a debt:gross assets ratio of 18%.

Macquarie Office Trust reported net income for the June year up 23.4% to $A65.3 million on operating income up 20.5% to $A96.1 million. Distributable earnings rose 3.25% to A11.13c/unit. Second half earnings were 3.8% above the prospectus forecast. Net tangible assets increased 7.7% to $A1.12/ unit. Total assets over the year increased by 30.7% to $A1 billion. Debt fell from 325 to 28% of gross assets.

Hong Kong’s Urban Renewal Authority has decided to limit itself to buying and clearing sites, leaving construction to private developers. It will sell up to $HK250 billion of land over the next 20 years, enough for about 70,000 flats.

8 August 2001

Keppel Corp Ltd, 32% owned by the Singapore Government, raised June half profit 20.8% to $S147.2 million but expects its second-half operating profit to be lower. However, it will report an exceptional profit of $S800 million from sale of its Keppel Capital Holdings Ltd stake to Singapore’s third-largest bank, OCBC Bank.

The ING Office Fund, previously the Armstrong Jones Office Group, reported an $A68.9 million profit for the June year, up 109% on revenue of $A123 million, up 118%. The fund wants to reduce its suburban office weighting, currently 28%. It has $A1.23 billion of assets, its portfolio is 99.5% leased with an expiry average of 7.3 years, nta is $A1.11, down A2c, basic earnings/unit rose from A4.6c to A7.9c, debt:total assets fell from 29.6% to 27.4%. The ratio of consolidated pretax profit:revenue fell from 58.3% to 56.1%, while net aftertax profit as a percentage of equity rose from 4% to 7.9%.

6 August 2001

Deutsche Industrial Trust increased profit before tax and amortisation, and after tax, by 107% to $A100 million on revenue up 103% to $A179.6 million in the year to June.

Equity Office Properties Trust of Chicago said its June quarter funds from operations rose 69% to $US272.7 million, or by 11.4% to US78c/fully diluted share, on revenue up 33.5% to $US663.4 million. Fully diluted earnings/share fell 16.7% to US40c, after no asset sales this time compared to a $US37 million gain last time. Adjusting for extraordinaries, earnings/share rose 11% to US40c. Same-store net operating income rose 7%, occupancy was 94.6%, and the weighted average gross rent on leases signed, at $US33.84/ft² was 10.2% above the average on expiring leases.

Dairy Farm International Ltd of Hong Kong took a $US45 million hit from winding down its Australian Franklins supermarket chain, helping one of its parents, Jardine Strategic, to a $US6 million loss for the June half compared to a $US71 million profit a year earlier. Profit of its other parent, Jardine Matheson, fell 74% to $US46 million. However, directors said two one-off results boosted the 2000 profit. They said continuing operations at Jardine Matheson fell 10% to $US46 million, and at Jardine Strategic they rose 10% to $US52 million.

Babcock & Brown group pushed its hold on MTM Entertainment Trust to 55.5% at the end of last week.

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Snapshot on world property, week to 2 March 2003

2 March 2003

The NSW state government has named a joint venture between Lend Lease Corp Ltd & General Property Trust as the preferred tenderer for a partnering agreement to create an $A1 billion regional centre at Rouse Hill in Sydney’s north-west. The project includes 1500 residential lots, retail & a town centre to be developed over 10 years. The state government has identified the Rouse Hill development area as the major corridor for Sydney’s expansion.

Corporate raider Laxey Partners, based on the Isle of Man, got 3.4% support last year when it tried to get the chairman & chief executive of British Land, John Ritblat, to move on. For the next British Land annual meeting, in July, Laxey has proposed selling most of the £9.3 billion portfolio, excluding City of London properties such as the Broadgate office complex next to Liverpool St Station. British Land shares are trading at a 50% discount to asset value. The listed British property sector overall is trading at a 38% discount.

28 February 2003

Coles Myer Ltd has chosen Westfield Trust as preferred bidder to acquire Central Sydney Plaza, incorporating Grace Brothers’ central city store on George, Pitt & Market Sts. The site was redeveloped in 1996-98, and in 1999 a Raffles Group hotel, the Merchant Court, plus 102 apartments were completed on 26 storeys above the store.

San Francisco-based MacFarlane Partners, which specialises in providing opportunistic real estate investments to a select group of institutional & private investment clients, has followed a major investment in the AOL Time Warner Centre in New York with a $US54 million (90%) investment in Forest City Enterprises Inc’s Met Lofts development in the downtown Los Angles South Park area, near the Staples Centre financial district. Met Lofts will have 264 apartments on 8 floors (average price about $NZ400,000), plus 1000m² of shops & an attached parking building. MacFarlane Partners announced its New York investment on 3 February: it will buy 49.5% (32,200m²) of the retail space, the 19,600m² of non-AOL Time Warner office space and the centre’s parking structure from Apollo Real Estate Advisors and related companies for a price which will be set in January 2005. Its value is estimated to be between $US425-500 million. MacFarlane Partners is also acquiring a $US359 million participating interest in the project’s $US1.22 billion GMAC Commercial Mortgage construction loan, and will invest in a fund that will own & operate 2 of the centre’s restaurants & a lounge bar.
Company websites: MacFarlane Partners
Forest City Enterprises

Simon Properties Inc has celebrated the departure of its former partner in The Forum Shops at Caesars in Las Vegas by signing a ground lease agreement with Caesar’s Palace owner Park Place Entertainment Corp enabling a 16,250m² 3-level extension of the shopping/dining/entertainment precinct to the Vegas Strip. The Forum Shops opened in 1992 with 26,300m² gross lettable area, increased to 46,500m² in 1997 and last year attracted 18 million visitors — an average of 50,000/day. Simon’s former partner in the centre, Gordon Group LLC, forced the $US174 million sale of its share to Simon after chairman Sheldon Gordon sided with Taubman Centers Inc against Simon’s hostile takeover bid for Taubman.

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Snapshot on world property, week to 28 December 2003

24 December 2003

Macquarie Office Trust has exchanged contracts to buy 50% of the Allianz Centre, a prime Sydney cbd office tower at 2 Market St, from Leda Holdings Ltd for $A111.75 million. Allianz Australia, the major tenant, owns the other half. The 24-level A-grade building, completed in 1990, contains 34,957m² & 301 parking spaces and is being acquired on a 7.5% yield before costs. The building is 99% occupied. Leda is giving Macquarie $A400,000 in income support.

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Snapshot on world property, week to 7 April 2002

3 April 2002

Cendant Corp is to buy timeshare resort developer & operator Trendwest Resorts Inc for $US894 million in stock. Trendwest, which runs timeshare on a points-based ownership system, discovered the South Pacific about 3 years ago, getting Hartner Construction of Auckland to build a Fijian project. Cendant has 2 other timeshare subsidiaries, Fairfield Resorts and Equivest, both concentrated in the eastern US. One of Trendwest’s main brands is Worldmark The Club.

SL Green Realty Corp has entered into a contribution agreement to acquire 1515 Broadway, New York, in a transaction valued at $US480 million. The property is currently owned by 1515 Broadway Associates LP, whose general partner is an affiliate of The Equitable Life Assurance Society of the US. The transaction will be accomplished through a prepackaged bankruptcy reorganisation by the 1515 Broadway partnership. SL Green will have a 55% interest through a joint venture with SITQ Immobilier. The property, between 44th and 45th Streets in the Times Square area, has a 160,000m², 54-storey office tower and is the headquarters of media & entertainment company Viacom Inc (CBS, MTV Networks, Paramount Pictures). Purchase price is about $US274/ft². The property is 98.2% leased, with current market rents for office space at a 34% premium to fully escalated in-place rents. The initial cash net operating income yield of the transaction is about 8.2%.

The listed National Golf Properties Inc and its main tenant, the unlisted American Golf Corp, plus some of American Golf’s affiliates such as European Golf LLC, are to become subsidiaries of a new umbrella company which their shareholders will jointly own, helping to ease American Golf, in particular, out of deep financial trouble. Both companies were founded by David Price, who will sit on the new board with 5 National Golf directors. The merger is expected to be finalised in the third quarter. The new company will own more than 300 public, private & resort courses in the United States, Britain, Japan & Australia, with combined revenue exceeding $US700 million. National Golf has won short-term forbearance from unsecured creditors owed $US300 million after defaulting on its facility.

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Snapshot on world property, week to 1 July 2001

Latest: New World criticised, Zhuhai airport selldown, Lhasa to China railway, Bunnings boosts warehouse portfolio, strong ING industrial revaluation, Kings Parking loss pending, ING logistics park, Equity Office in big LA greenfields project, Great Eagle buys HK Citibank floors, Sunland buys Jimna site at Surfers, boost for huge Yennora distribution park, big revaluations for Macquarie trust, Centro profit up 38%, Macquarie enters US neighbourhood centre market, Deutsche renames ex-Axa trust, Foodland buys 36 Franklins.

30 June 2001
Salomon Smith Barney has criticised New World Development Ltd in a brokerage letter to investors for not sticking to a promise to keep to its core business, property, and for failing to get its gearing below 45%. New World was reported in Hong Kong to be raising its stake in internet portal operator Skynet, which has warned it will make a huge loss for the year to March.
A few vehicles owned by the Zhuhai airport in the Pearl River delta were auctioned by a Guangzhou court on Thursday, for an 877,000 yuan ($NZ260,000) return. But the airport still owes about 40 million yuan ($NZ11.9 million) for land reclamation contracted in 1995, 1.7 billion yuan ($NZ500 million) of the 6.9 billion yuan airport construction cost, and has mounting operational losses. The airport has capacity for 12 million passengers/year, but only 570,000 used it last year.

Work began on Thursday on a 1118km railway line from Tibet’s capital, Lhasa, to the Chinese national rail grid at Golmud.

Perth-based Bunnings Warehouse Property Trust has increased its portfolio to 34 after buying two warehouse development sites in Victoria. It bought a 3.36ha site at Maribynong, 8km north-west of Melbourne’s central business district, for $A7.1 million, on a two-year leaseback before its development and long-term lease to Bunnings Building Supplies Pty Ltd. At Frankston, the trust has bought 3.77ha for $A7.3 million. Work on a Bunnings warehouse has started, for completion in December.

ING Industrial Fund, headed by David Blight in Sydney, raised its net asset value A5c after independent valuers added $A27.5 million, or 9.5%, to the book value of 11 properties in New South Wales, Victoria and Queensland. The revalued properties, 30% of the portfolio, are now worth $A315.75 million. Biggest gains for the fund were in South Sydney and North Ryde. Renewals and new leases raised the value of the PortAir industrial estate at Botany by 15%, and Mandible St, Alexandria, properties by 39%. At North Ryde, the fund’s new development at 1 Epping Rd gained 13.8% on development cost to a completion value of $A47.8 million. The South Sydney properties were capitalised at 9.5-10.5%, North Ryde at 8.5-10.25%, Victorian at 9.5-11.5%, and Queensland at 9.25-9.75%. The fund has 55 properties and total assets of $A1 billion.

Ariadne Australia Ltd said in a shareholder update on Thursday its Kings Parking division would report a loss at the 30 June balance date, but there were “tentative signs of improvement”. Ariadne is decentralising its parking businesses, which it said would cut overheads and streamline operations. Ariadne is negotiating the sale of a number of its properties. It has reached a court-ordered resolution of the Noosa Hill dispute, has signed an agreement on California court proceedings and hopes to get $US400,000 in September from disposal of stock in the West Coast Savings & Loan Association.

ING Industrial Fund has received development approval for two office/warehouse buildings totalling 23,000m² in its new TransLink Logistics Park at 10-16 McPherson St, Banksmeadow, South Sydney. Development cost is estimated at $A16.2 million, plus land, and the park is expected to give a 10.25% yield on total costs, including land. MPG Logistics Pty Ltd has been using 4ha of the site, where the new buildings will go, and will continue to occupy a 1885m² warehouse until 2003. Fund manager Paul Toussaint said completed value of all three buildings would be $A30 million. Expediters International Pty Ltd will take a seven-year lease on 12,000m² at a starting rent of $A111/m². The other, 11,000m² building has no tenant signed up.

29 June 2001

Equity Office Properties Trust has taken an 87.5% interest in a joint venture with Los Angeles commercial developer MaguirePartners to develop Water’s Edge, a 41,800m² complex of three office buildings and a 1238-car garage on 2.63ha in West Los Angeles. The land and phase 1 development cost is $US91 million. The first two buildings are scheduled for completion in August 2002. Start date for the third, 17,600m² building will depend on market conditions. Water’s Edge is part of a 440ha master-planned community, Playa Vista. Equity Office has also secured rights to participate in a later 46ha part of the project.

Investors in Equity Office Properties Trust and Spieker Properties Inc will vote on Monday on a merger announced in February. Equity Office, of Chicago, by far the largest real estate investment trust in the US, owns and manages 9.2 million m² of space in 380 buildings. Spieker, which concentrates on California and the Pacific North-west, has 3.5 million m² of commercial property, of which 2.3 million m² is office space.

28 June 2001

Great Eagle Holdings will buy 12 floors in Citibank Tower in Hong Kong Central from Citibank for $HK1.95 billion at $HK8394/ft², just over half financed by a syndicated bank loan and $HK300 million by the issuing of new shares at a 75% premium. Rent of just over $HK11 million/month in the first three years will provide a 6.8% yield. Citibank occupies nine of the floors.

Brisbane-based Sunland Group Pty Ltd has signed to buy the Jimna site in the heart of Surfers Paradise for an undisclosed sum. The contract requires Sunland to obtain development approval by the end of this year, with settlement two years later.

Stockland Trust Group’s industrial property general manager, Damian Dowling, said a New South Wales state government decision to nominate the trust’s Yennora distribution park as a site of state significance would be positive for investment and job creation. Stockland plans to invest $A40 million expanding Yennora, creating 300 new jobs directly and 1500-2000 indirectly. The park is one of Australia’s biggest undercover warehouse facilities. It has 280,000m² of lettable building space on a 68ha site, and direct rail links to all Sydney’s major rail terminals. Mr Dowling said the 200,000 tonnes of freight shifted by rail in 1999-2000 equalled 5000 truck movements taken off Sydney roads.

Macquarie Office Management Ltd, which manages the Macquarie Office Trust, said five properties had $A20.8 million of revaluation gains in the June 2001 quarter, taking the year’s revaluations to $A53.1 million, a 13.8% increase on the properties that were revalued during the year, reflecting strength in Melbourne and North Sydney. Zurich House in Melbourne was bought for $A28.45 million in January 2000 and has been revalued at $A48.5 million, a 70% rise, after the State Revenue Office’s rent was raised from $A130/m² to $A230/m². It’s now on an 8.71% cap rate. The Argus Centre in Melbourne rose $A6.8 million, or 6.4%, to $A113 million, at an 8.5% cap rate. NCR House in North Sydney rose $A6 million to $A48.4 million a year after acquisition for a 14.2% rise. It’s on an 8.75% cap rate.

Melbourne-based Centro Property Trust, owner of 17 shopping centres throughout Australia and the Mulgrave business park in Victoria, increased operating profit for the nine months to March by 38.4% to $A53.3 million. Centro more than doubled its services business to earn $A6.6 million net of overheads, after acquiring management rights for the listed Prime Retail Group and CT Retail Investment Trust. That side of the business contributed 13% of earnings. Centro issued equity to cut gearing from 31.6% to 24.4% and increased its asset base by 12.8% to $A1.13 billion. Net asset backing rose from $A2.50 to $A2.57/security. Across the portfolio sales rose 3.5% to an average $A4427/m², net of wholesale sales tax and gst. Annual sales rose 6.8% to $A1.76 billion and same-store sales 4.4%. Centro has bought the Taigum Central shopping centre in north Brisbane for $A67.7 million from Leda Holdings, to redevelop it as a 22,000m² “Market Place” equivalent subregional centre, anchored by Woolworths. Anticipated yield on completion in November is 9%. Centro has completed four stages of its $A21 million redevelopment of The Glen shopping centre 12km from the centre of Melbourne, including a switch from an IGA Rainbow supermarket to Coles, and construction of Centro’s head office above the David Jones store. CT trust unitholders on 15 June approved handing Centro 50% of three properties for $A42 million, two with strong development opportunities.

Macquarie CountryWide Trust of Sydney and US-listed Regency Centers have jointly bought (in a 75:25 split) five supermarket-based US shopping centres for $US36.8 million at an initial 9.7% yield. It takes the trust’s total assets to $A662 million and properties under management to 87, including 13 Progressive Enterprises sites in New Zealand. Regency has a 242-centre portfolio in 22 states. Macquarie CountryWide Management Ltd chief executive Kylie Rampa said the expansion into the US was to take advantage of higher total returns there. Regency will manage the properties, Macquarie CountryWide the debt and capital. The acquired properties are not big — 5800m² to 7400m² total space, with a supermarket and nine to 24 speciality stores.

Axa Australia Diversified Property Trust has changed its name to Deutsche Diversified Trust following the switch of management to Deutsche Property Funds Management Ltd.

Foodland Associated Ltd of Perth has signed to buy 36 Franklins stores in Queensland and northern New South Wales, plus a warehouse and fresh produce facility, from Dairy Farm International for $A155 million plus inventory.

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