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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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The driverless car, and the rail loop

The urge of regulators is usually to take away freedoms because there will always be people who take them to excess.

Using your cellphone while driving is a recent example: The regulatory response to motorists driving badly while on the phone was to tell us to stay off the phone.

But there’s another response: Carry on travelling, using the phone, reading a book – whatever. One way to do that is to use public transport, but this New York Times article suggests another is coming, and soon – the car that negotiates hazards, watches out for pedestrians…. actually does the driving.

“4 manufacturers — Volvo, BMW, Audi & Mercedes — have announced that as soon as this year they will begin offering models that will come with sensors & software to allow the car to drive itself in heavy traffic at speeds up to 37 miles/hour (60kph) …. At faster speeds, Cadillac’s Super Cruise system is intended to automate freeway driving by keeping the car within a lane and adjusting speed to other traffic.”

On TV, the Jetsons took their car off the road and into the air, but they still looked where they were going. This is different and raises a number of questions about transport planning.

Auckland Council & Auckland Transport are working on plans to complete the rail loop between Britomart & Mt Eden stations, focusing intensive development on 3 new stations along that new link. The council & its transport organisation have concluded no other public transport system will get the anticipated numbers of commuters in & out of the cbd, that buses & cars are heading to gridlock.

The Government doesn’t believe some of the numbers supporting the rail link, has been generally opposed to rail anyway, but has been otherwise unhelpful in promoting ideas on how to beat time-consuming & expensive congestion.

One of the key differences between Auckland & Government has been the timeframe for counting the discount rate for the development benefit:cost ratio. The Government standard is 30 years, which would mean the project is never feasible; the council & Auckland Transport want double that, which would make it feasible.

Imagine 2 scenarios. In one, in 15 years or so, you can’t reliably travel anywhere near the cbd by road because all roads are gridlocked. Access around much of the region is also badly hampered, and in many places gridlocked, because politicians weren’t prepared to pay the price of a system that would ease travel and at the same time encourage development of precincts which would suit new (for Auckland) living & working styles.

In the other scenario, the rail loop has been completed and was enthusiastically greeted by a surge of new rail commuters, some of the intensification in the new precincts has been carried out but, after a short time, rail users have declined and enthusiasm for living close together has also waned. The decline in rail use is because new modes of personal transport have been introduced – in the style of the cars in the New York Times story, because you can travel in your own suitcase – and communication advances have made it even less necessary to travel to communal offices. The reduced need for intensive office development has changed development economics and, in turn, that has changed overall project economics.

The first of these 2 scenarios is likely, the second fits easily under “dreaming”.

I was unimpressed by a transport minister who found the scope of the Sinclair Knight Merz city centre future access study inadequate, when his own staff had been involved in it. But it’s also important that some of that dreaming is done – scenarios from the possible to the far-fetched – and that it covers more than currently envisaged travel routes.

Link: New York Times, Drivers with hands full

Earlier stories:
31 December 2012: Stations are about transport? Or building a precinct?
31 December 2012: City rail: First it’s a question of will – there are lots of ways to do how
17 December 2012: Wider picture of Auckland access still not clear
14 December 2012: Auckland says rail link vital, Brownlee says study inadequate – it’s politics over action, but study plainly too narrow
13 September 2012:University confirms conditional deal on brewery site and likely Tamaki exit
3 July 2012:City rail link route affects 280 properties
9 March 2012: Council advances $8 million of budget for rail loop work
29 June 2011: Council agrees to seek rail loop designation
1 June 2011: Government says “not yet” for cbd rail loop, mayor says “all go”
26 November 2010:Brewer casts doubt on cbd growth predictions in rail loop case
25 November 2010: CBD rail loop business case unveiled

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Attribution: New York Times, story written by Bob Dey for the Bob Dey Property Report.

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Meatless meat?

In a land of sheep & cattle, should we take talk of fake meat seriously? Maybe not yet – according to Melbourne journalist, author & researcher Evelyn Tsitas it mostly tastes like mush.

But, she says in an article on the On Line Opinion website yesterday, there are plenty of examples of work underway to create “meat” which tastes good and doesn’t harm animals.

Maybe nothing to worry about at the moment, but the question is there: What is the long-term future of an agricultural economy? And, from that, for traditional land uses?

On Line Opinion, Faking it: meat substitutes take centre stage

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Attribution: On Line Opinion, Evelyn Tsitas, story written by Bob Dey for the Bob Dey Property Report.

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Snapshot on world property, week to 18 November 2012

Contents:

Serious catch to Australian housing incentives

Europe & Iraq troop withdrawal take Aecom to loss

Latest from RICS internationally

 

Serious catch to Australian housing incentives

 

Published 18 November 2012

Developers of outer suburban housing in Australia are offering all sorts of incentives to buy but the inducements come with a serious catch, as MacroInvestor chief economist & columnist Leith van Onselen wrote this week.

In Beware the house & land value trap, he criticised inducements such as giving buyers a new car, offering them large sums of cash back, free landscaping or paying their energy bill for the next 3 years.

Like the New Zealand apartment developers’ rent guarantee last decade, the incentive is paid for by the buyer – with differences making them even worse. First is stamp duty, paid on the full price. Second, the bank is likely to value the property minus incentives, effectively increasing the required deposit – a difference which could be as much as 15%.

 

Europe & Iraq troop withdrawal take Aecom to loss

Published 14 November 2012

Impairments of Aecom Technology Corp’s European business, and as a consequence of the US troop withdrawal from Iraq, took the company to a loss for both its fourth quarter and for the September year.

Los Angeles-based Aecom, a global provider of professional technical & management support services, reported its results overnight. The company acquired London-based Davis Langdon in 2010. Davis Langdon was the more international of the 2 businesses and runs the New Zealand operation.

Aecom said it exceeded targets, with $US226 million in operating cashflow and $US211 million in free cashflow. The Asia & Pacific regions and transport sector contributed strongly to its $US2.1 billion in fourth-quarter revenue, and project backlog of $US 16 billion.

For the fourth quarter, due to the $US336 million impairment charge ($US317 million net of tax), the company reported an operating loss of $US199 million, a net loss of $US225 million and a loss/share of $US2.05. Adjusted to exclude the goodwill impairment charge, operating income was $US137 million, net income was $US92 million and diluted earnings/share were US83c.

Aecom said the impairment charge in Europe resulted primarily from the negative impact of economic trends, which drove a reduction in profit levels. The impairment in management support services was largely driven by the loss of revenue “due to the precipitous drawdown of troops in Iraq during 2012”.

However, based on the strong growth in profit in the second half of fiscal 2012, the company expected both its Europe & management support services businesses would show strong growth in profitability in fiscal 2013. It said the impairment didn’t have any impact on the company’s compliance with its debt covenants, cashflows or operations.

Latest from RICS internationally

The RICS (Royal Institution of Chartered Surveyors) global real estate weekly updates can be reached from this link: RICS, grew.

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

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Snapshot on links, week to 11 November 2012

Contents:

Stimulation, gridlock or economic advance?

There are more than 1100 direct links to external websites on the Bob Dey Property Report links page. If your site’s listed on the Useful links page, please let me know when you introduce new material. If it’s not listed and it should be, send me an email: [email protected].

9 November 2012:

Stimulation, gridlock or economic advance?

The New Zealand approach to defeating a recession in both 1987 and during the last 5 years of global financial bewilderment differed both times from most approaches around the world. Here, the public & business were left pretty much to their own devices, with limited economic stimulation.

Australia had strong government support post ’87 and resorted to stimulative tactics this time round, such as lifting the subsidy paid to first-homebuyers, which immediately raised the price of housing. When the stimulation ended or was reduced, construction slumped and prices fell back. All that happened was that some economy activity was shifted forward, with a consequent raising of costs & prices, followed by an economic desert: no gain.

In the US, the stimulation was excessive in the attempt to defeat cyclical change by maintaining economic growth based on consumer spending. But most of the stimulation didn’t go to consumers and, if it did, they thought saving and cutting their debt were better options.

The New Republic surprised me a while back with a story on the achievements of President Obama in his first term – he’d quietly accomplished a lot despite the daily grind of political combat. Most interesting for me from his re-election is his approach to the debt mountain, what & by how much he might try to cut back, if at all. His decision on that will affect all of us.

The central battlefield will again be over the terms of the American welfare state – welfare for the rich versus welfare for the poor & middle, and a New Republic article yesterday expands on the second part of the US political system, the pressure (lobby) system, to explain the paths the 2 sides are likely to take to block/advance economic change.

Link: Despite their losses last night, Republicans have one trick left: gridlock

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

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Snapshot on links, week to 7 October 2012

Contents:

Who needs a desk? Or an office?

Counting the trillions

Planet of Cities and Atlas of Urban Expansion – how to accommodate growth

Beauty in sprawl

What exactly is a smart city?

Today’s items look like they cover just a handful of topics – but there are 14 links you can go to if you want to dig further into them.

There are more than 1100 direct links to external websites on the Bob Dey Property Report links page. If your site’s listed on the Useful links page, please let me know when you introduce new material. If it’s not listed and it should be, send me an email: [email protected].co.nz.

7 October 2012:

 

Who needs a desk? Or an office?

 

Colliers International research director Alan McMahon reckoned, in a presentation this week, it would be hard to go much below the 15.9m²/workstation reached in a 2010 survey. In fact, cbd office density relaxed a little in 2012 to an average 17.1m²/workstation.

One factor is that people need a desk. But do they? According to a Citrix survey in 19 countries, senior IT executives estimated they’d need only 7 desks for every 10 office workers by 2020, thanks to increasing telecommuting, and in telecommuting-friendly countries the ratio would get down to 6 desks:10 workers.

 

Link: Fastcoexist, The future of working from home

 

Counting the trillions

When you’re counting the numbers – the cost of a purchase or project, for instance – keep in mind the Government contribution. In the US, the Zero Hedge website helps in this exercise. It calculated at the end of August that the US Government took just 286 days to tot up another $US1 trillion of debt – $US3.5 billion/day.

At this rate, Zero Hedge calculated, US Government debt will hit $US17 trillion on 10 June 2013, $US18 trillion on 16 March 2014, $US19 trillion on 3 January 2015 and $US20 trillion on 16 October 2015. But first it has to cut through Congress’ latest self-imposed ceiling of $US16.394 trillion, which should happen in December.

Links: Zero Hedge $16,OOO,OOO,OOO,OOOBAMA!

Planet of Cities and Atlas of Urban Expansion – how to accommodate growth

Lincoln Institute visiting fellow Shlomo “Solly” Angel has produced a 360-page book on how to accommodate rapidly expanding urban growth without using containment policies – which, he says, are “practically useless in addressing the central questions”.

That book, Planet of Cities, has a 397-page companion volume, Atlas of Urban Expansion, “a comprehensive guide to the past & future characteristics of metropolitan growth”.

The Planet of Cities abstract notes that, in place of containment/smart growth, Mr Angel proposes to revive an alternative making-room paradigm that seeks to come to terms with the expected expansion of cities, particularly in the rapidly urbanising countries in Asia & Africa, and to make the minimally necessary preparations for such expansion instead of seeking to contain it.

Mr Angel says city expansion can’t be contained, so room must be made to accommodate it. Despite his criticism of containment, he’s not opposed to all management. He says densities must be sustainable – allowed to increase if they’re too low, decrease if they’re too high.

Those are 2 of the 4 propositions to his paradigm. The other 2 are:

Strict containment of urban expansion destroys the homes of the poor and puts new housing out of reach for most people. Decent housing for all can be ensured only if urban land is in ample supply, andAs cities expand, the necessary land for public streets, public infrastructure networks and public open spaces must be secured in advance of development.

The Atlas of Urban Expansion abstract notes: “The world’s urban population is expected to increase from 3.5 billion in 2010 to 6.2 billion in 2050, and almost all of this growth is expected to take place in less developed countries. Cities in developed countries will add only 160 million people to their populations during this period, while cities in developing countries will need to absorb 15 times that number, or close to 2.6 billion people, thereby doubling their total urban population of 2.6 billion in 2010. Given the expected decline in urban densities, these cities are likely to more than triple their developed land areas by 2050.”

Mr Angel presented a preliminary paper on the books’ theme at a conference on sustainable development in January 2011, hosted by the Lincoln Institute and sponsored by the Cities Alliance & World Bank urban department. He’s a senior research scholar at the Urbanisation Project, adjunct professor of urban planning at New York University’s Wagner School and a l at Princeton University’s Woodrow Wilson School.

Links: Planet of Cities Atlas of Urban Expansion Making room for a planet of cities Cities Alliance

Beauty in sprawl

German photographer Christoph Gielen has found beauty in sprawl. Starting with statistics, sifting through examples of sprawl across the US, he decided his selection and took helicopter flyovers to shoot them. Fast Company writer Ariel Schwartz commented: "He ended with beautiful aerial photographs of sprawl in all its geometric glory."

What exactly is a smart city?

In another Fast Company article, climate strategist Dr Boyd Cohen has asked, What exactly is a smart city? “I believe that the smart-cities movement is being held back by a lack of clarity & consensus around what a smart city is and what the components of a smart city actually are.” As well as giving his answer, he produces an annual top 10 smart cities (international), next version out soon.

In a posting on Planetizen last month, Jonathan Netter raised the question: What defines a city? “As anyone who’s raised an eyebrow upon hearing that Los Angeles is technically more dense than New York can attest, making city-to-city comparisons can be a confounding endeavour.” Nate Berg’s story at Atlantic Cities, In search of a uniform way to define the city, points to OECD research.

Research authors Monica Brezzi, Mario Piacentrini, Konstantin Rosina & Daniel Sanchez-Serra proposed the concept of “functional urban areas” based on population density & travel-to-work flows: “Basically, it’s a measurement of population & interconnected economies."

The research has specifically addressed:

The growing consensus that public policy should be concerned not only with the scale of urbanisation, but also with its geographic shape. The functioning & efficiency of linkages between cities, and those between urban & rural areas, can lead to important changes in how & where economic production takes placeThe role of large metropolitan areas in the global economy and their capacity to realise the benefits of economic agglomeration, industrial clustering & innovation.

Links:

Co.exist, The hidden beauty of suburban sprawl Christoph Gielen Co.exist, What exactly is a smart city? Co.exist, Smart cities top 10 Planetizen, What exactly is a smart city? Atlantic Cities, In search of a uniform way to define the city OECD, Redefining “urban”, a new way to measure metropolitan areas

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

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Snapshot on links, week to 26 August 2012

Contents:

Business Spectator, Why the carbon tax doesn’t work

Copenhagen Consensus Skeptical Environmentalist, opening pages Project Syndicate

Journalism.org

Exaro News

NZ Initiative

Roger Kerr, Friday graph

ShadowStats

There are more than 1100 direct links to external websites on the Bob Dey Property Report links page. If your site’s listed on the Useful links page, please let me know when you introduce new material. If it’s not listed and it should be, send me an email: [email protected].

21 August 2012:

I was surprised to see Business Spectator’s Bob Gottliebsen uncritically accept Bjørn Lomborg’s view yesterday on why the Australian carbon tax doesn’t work: “From my point of view, he is one of the first people I have heard who makes sense on carbon,” MrGottliebsen commented.

 

Bjørn Lomborg is a debunker of widely held ideas. Take this one, for example: “… concerns about global warming are the main reason that corn prices have skyrocketed since 2005. Nowadays 40% of corn grown in the US is used to produce ethanol, which does absolutely nothing for the climate, but certainly distorts the price of corn – at the expense of many of the world’s poorest people.”

 

Mr Lomborg is the author of The Skeptical Environmentalist, measuring the real state of the world (1998) & Cool It, head of the Copenhagen Consensus Centre and adjunct professor at Copenhagen Business School. His expertise was in cost:benefit analysis, which he’s translated to environmental issues. The Copenhagen Consensus Centre is a think-tank that publicises the best ways for governments & philanthropists to spend aid & development money…. In particular, we focus on the international community’s effort to solve the world’s biggest challenges and on how to do this in the most cost-efficient manner.”

He’s also a contributor to Project Syndicate, which describes itself as “a world of ideas….. offering incisive perspectives on our changing world from those who are shaping its economics, politics, science & culture”.

“One of the world’s biggest green-energy public-policy experiments is coming to a bitter end in Germany, with important lessons for policymakers elsewhere,” Bjørn Lomborg wrote in a Project Syndicate piece in February on Germany’s subsidies for solar energy.

Among other contributors, Nouriel Roubini wrote last week about Early retirement for the Eurozone. Professor Roubini was one of the few economists to predict the global financial crisis. He’s a professor at New York University’s Stern School of Business and chairman of Roubini Global Economics.

Links: Business Spectator, Why the carbon tax doesn’t work

Copenhagen Consensus Skeptical Environmentalist, opening pages Project Syndicate

20 August 2012:

The week starts with 2 news links, and some on economics….

First, a link to the new news-in-depth website interest.co.nz’s Bernard Hickey will head, launching on 1 November – “public-interest journalism funded by the public… a not-for-profit trust dedicated to supporting & building public-interest news, analysis, comment & debate”. And a UK news website that opened last October, Exaro News – “an online subscription service that investigates issues that are important to business in particular and to the public in general, but which are being inadequately covered – or ignored – by the mainstream media”.

Links: Journalism.org

Exaro News

Which, in due course, took me to the economy category of this website’s external links page (after a visit to interest.co, then a click on a story there). About time to update my Business Roundtable link, seeing that it merged with the NZ Institute in April to form the NZ Initiative.

Also in passing, I checked to see if Roger Kerr’s blog was still online, as he died last year. The blog’s still there, and his last posting, Friday graph: The myth that New Zealand’s net external indebtedness is a savings story, is worth returning to for a reminder of how far west of reality mainstream economics has veered.

I thought I had John Williams’ ShadowStats on the links page – it is now. I stopped believing most US statistics years ago, chiefly because the seasonal adjustments seemed so suspect, and consequently stopped presenting them here. John Williams, an economist for 4 decades, took to reviewing US Government statistics, doing his own analysis and creating his shadow version. He has the US unemployment rate around 23% compared to the Government’s figure – around 8%. He has CPI inflation at 5%, the Government has it below 2%.

Links: NZ Initiative

Roger Kerr, Friday graph

ShadowStats

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

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Snapshot on links, week to 19 August 2012

Contents:

Legal Street, just off Queen

Office Suites offers space in Wellington

Lively property views from Australia

UK progressive think tank

Looking back through my files, I see a backlog of links that haven’t quite been formatted right, finished off & posted. Not entirely surprising given the workload, something to remedy and, in the meantime, I’ll post a few new links today while the backlog stays where it is.

There are more than 1100 direct links to external websites on the Bob Dey Property Report links page. If your site’s listed on the Useful links page, please let me know when you introduce new material. If it’s not listed and it should be, send me an email: [email protected].

19 August 2012:

 

Legal Street, just off Queen

Lawyer David Beard began Legal Street 2 years ago, covering a wide range of services and an aim to solve problems, add value & reduce costs. He’s based just off Queen St, less than 100m from the Auckland District Court.

Link: Legal Street

Office Suites offers space in Wellington

Peter Dowell, of Heritage Property Group Ltd in Wellington, also runs Office Suites Ltd with space in 2 buildings in the capital, at Chews Lane and in Panama St.

Link: Office Suites

 

Lively property views from Australia

From Australia, 2 links for the Property Update website, one of them the main website and the other a blog by Michael Yardney. Also from Australia, the Property Observer is a lively news site.

Links: Property Update Property Investment Update blog Property Observer

 

UK progressive think tank

 

And from London, theInstitute for Public Policy Researchdescribes itself as “the UK’s leading progressive thinktank. We produce rigorous research & innovative policy ideas for a fair, democratic & sustainable world”.

Link: Institute for Public Policy Research

 

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

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Snapshot on world property, week to 24 June 2012

Contents:

Metcash to acquire whole of Mitre 10 Australia

$A200 million Centro court settlement approved

Latest from RICS internationally

22 June 2012:

 

Metcash to acquire whole of Mitre 10 Australia

Grocery wholesaler Metcash Ltd said on Wednesday it intended to take 100% ownership of the Mitre 10 Group in Australia. It has 50.1% now.

The Mitre 10 businesses in Australia & New Zealand have had common owners before, but Mitre 10 (NZ) Ltd is now owned by operators of the company’s franchises.

Metcash chief executive Andrew Reitzer said its acquisition was subject to the Mitre 10 Group’s audited accounts for the June year being in accordance with Metcash’s expectations. He said Metcash would give more details of its acquisition when it releases its annual result on Thursday 28 June.

The Mitre 10 Group in Australia has more than 400 Mitre 10 & True Value stores, and distributes to another 400 non-branded independent hardware stores. It competes with the 200-store Bunnings chain and the Masters chain which Woolworths Ltd is growing.

20 June 2012:

 

$A200 million Centro court settlement approved

The Australian Federal Court gave its approval yesterday to the former Centro Properties Group (now the CNPR Group)’s $A200 million settlement of class actions brought over misleading information of $A3 billion of debt in 2007.

The 6 proceedings, including the class actions, went to trial in March but an agreement was reached in May.

Under the settlement, CNPR Group contributes $A10 million, Centro Retail Australia $A85 million, PricewaterhouseCoopers $A67 million and available insurance proceeds $A38 million.

Justice John Middleton gave his approval without admission of liability by Centro Properties.

The claims were brought by 2 law firms specialising in compensation – Maurice Blackburn, representing 1000 applicants, who were awarded $A150 million, minus $A60 million in legal costs; and Slater & Gordon, representing 5000 smaller investors, awarded the other $A50 million, minus $A10 million in costs.

Earlier stories:

5 November 2010: Whole of Centro up for grabs

15 January 2008: Centro changes the chook in charge as its woes extend

2 January 2008: Centro seeks expressions of interest, including carve-up & total sale

19 December 2007: Centro head units down 86% as refinancing fails

Latest from RICS internationally

The RICS (Royal Institution of Chartered Surveyors) global real estate weekly updates can be reached from this link: RICS, grew

Want to comment? Go to the forum.

 

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

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Snapshot on world property, week to 17 June 2012

Contents:

US story suggests convention centres have done their dash

Latest from RICS internationally

14 June 2012:

US story suggests convention centres have done their dash

It’s fairly easy to spot US articles for or against the development of convention centres, and the market on a large continent is obviously much different from ours. The latest article on the subject came to my notice yesterday, Is it time to stop building convention centres? By Amanda Erickson on The Atlantic Cities website.

She wrote that convention space in the US had increased by 50% over the last 20 years, 44 new convention spaces had been planned or constructed since 2005 and spending on building them had doubled to $US2.4 billion/year, much of it from public coffers.

The article works through the theory – conventions equals visitors equals more spending – presents some interesting history, points to examples where the returns haven’t fulfilled the promise.

As usual, I related in it back to Auckland where, for the moment, SkyCity’s proposal west of the cbd remains front runner for a convention centre. Plenty of modelling has been done to show value from building a convention centre, but most eyes on the present proposal see just that: a bald building.

Auckland Council environmental strategy & policy manager Ludo Campbell- Reid produced a proposal to upgrade Federal St in partnership with SkyCity Entertainment Group Ltd, which has its casino on one side of the road, its convention centre on the other and hotels on both sides. SkyCity has since opened several cafes & restaurants there.

But Mr Campbell- Reid was thinking beyond that one street, looking at an upgrade that would continue through to the western fringe of the cbd, which is where SkyCity wants to build the proposed national convention centre.

Assuming the upgrade is extended, the value equation must also change.

Link: The Atlantic Cities, Is it time to stop building convention centres?

Earlier stories:

29 June 2011: Anti-gambling wedge nearly derails mayor’s convention centre position

12 June 2011: SkyCity wins convention centre contest

Latest from RICS internationally

The RICS (Royal Institution of Chartered Surveyors) global real estate weekly updates 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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