Commercial and residential property news
A RECORD number of New Zealanders are moving to Australia.
According to Statistics New Zealand, 3300 New Zealanders moved to Australia in May – and that figure is net (meaning it cancels out those who are relocating the other way).
The Christchurch earthquakes and aftershocks, as well as a weak economy, is driving the trend. Christchurch is New Zealand’s second largest city and did have a population of 300,000.
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RENTERS want landlords to pay them greater respect, and they want to be able to customise their homes, according to a recent survey by online group rent.com.au.
The survey also rated as top renter concerns: the ability to own a pet, hang artwork and photos, work on gardens, or enjoy better quality kitchens. Renters also called for home-inspection times that are outside of business hours, and for more time to inspect homes, so as to “get a feel”.
The survey, reported in various press, does not disclose the number of survey respondents. However the issues have presented for decades to landlords.
Interestingly the survey raised an issue of advertised rents often differing from prices given during inspections.
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DESPITE warnings from Queensland independent Bob Katter, overseas investors are continuing to snap up Australian agriculture land.
This time, the Swedish National Pension Fund is teaming with US institutional investor TIAA-CREF, making a commitment to invest more in Australia.
Through its Westchester Group, TIAA-CREF already controls 180,000 hectares of cropping country. The “TIAA” refers to the Teachers Insurance and Annuity Association of America, which took an 85 per cent controlling interest in Westchester Group late last year.
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RECRUITMENT firms say foreign developers that have been snapping up Australian assets are actively in the office market for lease.
Groups looking to establish or expand Australian operations include Asian broker and fund manager CLSA, global sovereign funds such as the Canada Pension Plan Investment Board, Government of Singapore Corporation and South Korea’s Investment Corporation.
LaSalle Investment Management and the US-based pramerica Real Estate Investors are also looking for space, according to the AFR.
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HASSAD – the agricultural arm of the Qatari government – is in negotiations to buy five properties in western Victoria, in a deal reportedly worth $45 million.
The portfolio will bring the value of Australian assets purchased by the overseas group in the past twelve months to over $100 million.
Hassad is said to be considering purchasing another major property in NSW from one of the Victorian vendors.
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THE Australian Bureau of Statistics today released official building approval numbers.
They show the number of dwellings approved nationally fell by 1.3 per cent in April, after rising 8.6 per cent in March (seasonally adjusted).
Victoria held about steady, while New South Wales, Western Australia and Tasmania recorded major drops. By comparison, South Australia and Queensland reported notable rises.
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A CONTROVERSIAL new population strategy – which sets no population target at all – has concerned peak property bodies.
The Gillard government’s first population strategy, Sustainable Australia, Sustainable Communities, is “political in nature’ according to the Property Council of Australia chief executive Peter Verwer, who added it contained “little more than motherhood statements, previously announced government initiatives and ongoing government programs.”
“This is not a detailed plan for managing population growth and to describe it as a policy or a strategy would be stretching credibility,” Mr Verwer was quoted as saying in The Australian. “We need to grow our population, which needs taxation revenue to fund vital services,” he added.
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RENTAL vacancy levels increased last month according to SQM Research.
For the month, there were 6135 more residences listed for rent, bringing the total to 47,787 nationally. Last April the figure was around 37,000.
Melbourne had the highest rental vacancy rate at 2.6 per cent, according to SQM, while Canberra, the nation’s capital, had the lowest amount of rental stock: 0.6 per cent.
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IN A positive move for middle-aged and older Australians, the Australian Securities and Investment Commission has ordered banks to relax rules that restricted borrowing capacity.
On April 23 ASIC announced it clarified responsible lending guidelines introduced in January – which inadvertently resulted in banks and non-bank lenders being rejected credit applications from middle aged people without a substantial retirement egg.
ASIC now says lenders must ask more questions to determine whether a middle aged applicant will be able to repay a 25-year owner occupier mortgage loan, if they are due, for example, to retire in the next decade.
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RENTS for houses and apartments are expected to rise this year, as a result of accelerated economic activity, housing shortages and a depressed first home buyers market.
Australian Property Monitors, a property analyst, predicts a steep rise in rents this year, following what was a quarter of growth in March 2011.
According to APM, Sydney apartment rents have increased 7.1 per cent in the past twelve months, followed closely by Adelaide and Canberra.
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A REPORT by finance giant QBE says one in 10 mortgage holders would not be able to make their repayments if interest rates rise by one quarter of a per cent.
This figure rises to one in four Australians, if interest rates were to rise half a per cent.
The report also says 80 per cent of first home buyers said the property market was overvalued, but one in five said they are still likely to make a purchase in the next six months.
The report, by QBE Lenders Mortgage Insurance, says on average 25 per cent of owner occupiers are suffering mortgage stress, with this figure likely to rise in line with future interest rate rises.
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AUSTRALIA’s almost uninterrupted strong economic run – which has resulted in an almost uninterrupted consumption binge – is piquing the interest of North America’s major retail businesses.
According to a new report by commercial agency CB Richard Ellis, Sydney and Melbourne (image, Brighton bathing boxes, right) have both ranked in the top 10 most attractive destinations for expansion.
The survey samples 323 global retailers, and 209 cities in 73 countries.
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CEDAR Woods Properties has rejected a $310 million takeover offer, saying that purchase price undervalued the company.
The company confirmed a third party has offered $5.05 per share before being told it was “insufficient”.
“The Cedar Woods’ board has consistently stated that it believes the current (market) value of the company’s projects to be substantially above the value reflected in its share price,” it is reported as saying in The Australian.
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THE commercial property sector’s biggest fundraiser is about to peddle off again, though thankfully for the Victorian participants, the weather is looking calmer than last year.
This time, the Chain Reaction bike ride will go national – with a Queensland ride scheduled for May taking participants from Forster, in New South Wales, to Brisbane.
A Victorian ride kicks off from Sydney next Saturday March 12, and concludes in Melbourne on Friday March 18, incorporating the Labour Day public holiday. The 1200 kilometre track will take participants through the Snowy Mountains.
Some 45 riders – representing commercial and residential sectors – are registered to accept donations for the ride this year.
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QUEENSLAND based Devine Limited has purchased a 107-unit apartment complex in the fringe Brisbane suburb of Teneriffe, and a 22
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AUSTRALIA’s prestige property market appears to still be in deceleration mode.
In Sydney, the Vaucluse mansion being offloaded by the Cattell family has been reduced from $21 million to $18 million. Nearby, property developer Paul Smith sold his Bellevue Hill home for a price believed to be “a heavy discount” to the $14 million he first asked last year.
SQM Research managing director Louis Christoper said the Sydney and Melbourne prestige market are recording modest price falls.
GOOGLE has shelved plans to feature real estate listings within its Google Maps.
The company cited low usage for the feature, which is available in the US, Australia, New Zealand, the UK and Japan.
The feature was launched in 2009, but despite offering free listings, failed to knock off the dominant Australian real estate search engines, realestate.com.au and domain.com.au.
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THE largest private owner of forestry land in Australia is now a Canadian pension fund.
Alberta Investment Management Corp (AIMCo) has paid $415 million for 252,000 hectares of timber land. The land was offloaded by collapsed managed investment scheme operator, Great Southern.
The price paid is 60 per cent of the land’s value three years ago, and before legislative changes triggered the collapse of two large industry players, including Timbercorp as well as Great Southern.
AIMCo chief executive Leo de Bever told the AFR the group had been working to buy the site for more than a year.
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INVESTOR demand for Australian hotels surged last year.
Hotel transactions surged 62.3 per cent last year, totalling $1.3 billion, according to JLL Hotels.
Demand for hotel investments was boosted by a strong business travel market which have pushed up room rates and occupancy levels in major capital city markets.
The Ayers Rock Resort was last year’s biggest hotel transaction, selling for $300 million.
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THE Sydney and Perth residential sectors may have been the basket case of the country in recent years, but all that is expected to change, according to new research by MacroPlan.
The consultancy expects Sydney and Perth will lead the nation in regard to demand this year, led by increasing incomes, improving business prosperity and a shortage of new residential supply.
MacroPlan also anticipates some regional centres will perform well on the back of the resources boom, population growth and value.
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LAST year, by and large, residential landlords were the investors best able to reap the rewards of a short supply, by boosting their rents.
This year however, may be year of the office landlord.
According to a new report by commercial real estate agency Colliers International, office rental costs are expected to increase in most capital cities, because of a shortage of new supply and an improving economy.
It expects office vacancies to fall in all major CBD office markets expect Brisbane (which already has a high 9.6 per cent vacancy).
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CENTRO Properties Group is expected to list for sale a $4 billion portfolio of prime retail assets, as its bankers call for the company to settle its debts.
It’s expected Perth’s Galleria complex, and The Glen, in the south-east Melbourne suburb of Glen Waverley will be two of the 40-plus assets offered for sale.
Lend Lease, Colonial First State Global Management and AMP Capital Investors are expected to be in the mix of prospective purchasers, though the sale might also be on an individual shopping centre basis.
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DEXUS Wholesale Property Fund has paid Colonial Direct Property Investment Fund $231 million for a portfolio of 13 industrial portfolios on Australia’s east coast.
The purchase includes eight properties in Sydney, three in Melbourne and two in Brisbane. Some are income producing investments, while others are development sites.
After the acquisition, DWPF’s portfolio allocation will be 57 per cent retail, 32 per cent office and 11 per cent industrial – though the plan is to boost the industrial allocation.
SYDNEY based developer and fund manager Lend Lease has announced an agreement to develop a swag of national, master planned residential and community projects with Japan based Sekisui House.
The arrangement, which is subject to conditions, will see Sekisui acquire a 50 per cent interest in Lend Lease’s controversial 15-level Serrata apartment tower proposal, in Docklands.
Sekisui House will also buy land at Lend Lease’s Hyatt Coolum on the Sunshine Coast, Queensland, and a piece of a project at Wentworth Point, near Homebush, in western Sydney.
A copy of Lend Lease’s ASX announcement is below:
A MAJOR but confidential Expression of Interest campaign seeking residential rental properties – believed to be for the government’s affiliated affordable and social housing agencies – has closed after almost six months.
The advertisement sought 400 unoccupied dwellings nationally, configured as motel rooms, blocks of flats, disused retirement villages, and clusters of units and houses.
The mystery tenant is offering 12 month leases with renewal options of up to five years on a case by case basis.
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THE federal and state governments are continuing to buy development sites and vacant properties that it can convert into public housing.
It has recently acquired two prominent properties in the seaside hamlet of Wonthaggi, about 132 kilometres south-east of Melbourne.
In the highest profile deal, the government outmuscled developers and operators for the former Golf Links Hotel, which is set to be redeveloped into a major rooming house.
At another site at 7 Mortimer Street, near the Wonthaggi town centre, a vacant block offering picturesque views over the Wonthaggi Golf Course and Bass Strait is also set to make way for a new commission flat complex.
Read moreSALTA Properties is reportedly now in negotiations to sell its industrial portfolio to Singaporean government investment group GIC, for about $220 million.
The GIC offer replaces an earlier reported deal made by Korean pension fund Ikogest Asia.
Salta is selling eight separate logistics facilities in Victoria, New South Wales and Queensland.
Before news of a private sale, the portfolio was expected to be floated.
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KOREAN-based investors have emerged as one of the biggest buyers of Australian commercial real estate since the 2008 economic downturn.
In one of the most recent moves, Ikogest Asia, a Luxembourg-based, Korean-backed pension fund, reportedly made an offer to pay about $200 million for the industrial holdings, and part of a float being offloaded by Melbourne-based developer Salta Properties.
Singapore’s GIC is now reportedly investigating that portfolio.
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AUSTRALIA’s lucrative student accommodation sector is at risk, with cash strapped United States universities said to be preparing to open their doors to more foreign graduates in the wake of the economic downturn.
A cheaper US dollar, scores of student accommodation and faster visa approval times than Australia, should give the United States an edge, according to a report in The Australian’s Higher Education section.
“The obvious implication is the market for foreign students will become more competitive because you will have a lot of large and high-prestige universities competing for students,” he said.
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THE levels of waste being uncovered as part of the Rudd government’s Building the Education Revolution are continuing to come to light with a report in The Australian showing school canteens built by the Catholic school system under the controversial $16.2 billion program, are up to five times cheaper than those delivered by the government.
Geraldton’s St Lawrence Primary School at Bluff Point has developed a 10m x 7.5 m canteen for $4043 per square metre.
By comparison, the governments “unusable” small NSW canteens, measuring 8.47m x 3.1 m, costs $23,000 per square metre.
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