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Vol 12. No.9

Landsburys Independent Accreditation Reports

Economic Overview

	Current	+/-	Movement
$AUS/$US	98.84	-0.67
Cash Rate	4.75	Steady
90 Day Bill	5.00	+0.01
10 Year Bond	5.488	-0.050
ASX 200	4801.5	+6.3

Victoria Property

• Former Toll Holdings chairman Peter Rowsthorn has sold his thoroughbred racing stables, Wadham Park Seymour, in central Victoria, for about $5 million.
• The property, which he bought with thoroughbred trainer Dale Sutton in 2007, was bought by thoroughbred trainers Jim and June Anderson.
• On the Seymour-Nagambie belt along Northwood Road, the property is considered one of the best thoroughbred training facilities in Victoria.
• The property comprises two lots: lot A with 101 hectares and two stable buildings holding 36 boxes and lot B, which is 216 hectares and includes river flats and pasture.

National Property

• The non-residential construction market may be facing one of its toughest periods as government stimulus packages are phased out and flooding delays projects.
• The construction industry was one of the hardest hit by the global financial crises as banking finance became scarce and many developers either collapsed or went to ground.
• The Australian Industry Group and Housing Industry Association’s performance of construction index shows the impact of stimulus spending has worn off and private sector investment is yet to take its place, with activity and new orders contracting again in December after a series of subdued months.
• Although the widespread flooding is likely to create a vast quantity of work in the medium term, it has also destroyed equipment and materials.
• Research found companies exposed to the building materials sector would be hurt by the floods but government spending and associated construction work boded well.
• The damage caused by the east coast floods is another hurdle for the industry that has broadly suffered all last year and now faces an uncertain year ahead.
• The past year forced many builders to do jobs at little to no margin just to keep the books turning over.
• One-third of local builders that responded to a survey said their current bid margins were more than 2% below margins on existing backlog.
• A gradual recovery in commercial and industrial building is tipped by many industry groups.
• Prior to the Queensland floods, Macromonitor forecasts the building industry would soon reach its lowest ebb for commercial and industrial building followed by a steady recovery in the second half of this year.
• Underpinning this trend, it is predicted greater demand for office space and retail turnover will improve, however it will be nowhere near as high as before the financial crisis.
• The coming year will be far from easy, with forecast predicting a 28% real decline in total non-residential building commencements in 2010-11 followed by a 4% recovery in the following year.