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Vol 11. No.127

Landsburys Independent Accreditation Reports

Economic Overview

	Current	+/-	Movement
$AUS/$US	84.82	+0.30
Cash Rate	4.50	Steady
90 Day Bill	4.85	Steady
10 Year Bond	5.052	-0.017
ASX 200	4254.6	-21.5

NSW Property

CUB development update (AFR Pg.49)

• Yesterday NSW Planning Minister Tony Kelly approved the first residential and commercial stages in Frasers Property Australia's Central Park development on the former Carlton United Brewery site at Broadway in Sydney.
• The residential towers will comprise 593 apartments and the commercial campus will have 68,000m² of space.
• Work on the residential towers will commence by the end of 2010.

Magenta Shores “shared ownership” offer (AFR Pg.50)

• Mirvac Group will offer beachfront and golf homes at Magenta Shores on the NSW Central Coast under “shared ownership” as proposed by Dransfield Hotels and Resorts.
• Assuming regulatory title approval, from September there may be up to 8 individual owners per property.
• Furnished 4 bedroom golf homes will be offered from $225,000 for up to 8 owners. Shares of beachfront houses will be from $400,000.
• Owners will pay an annual fee of $8,000 for all cleaning and maintenance and access to the golf course. Also included is a $2,000 fee for Dransfield to manage the property’s holiday schedule.
• Owners will be able to spend up to 8 weeks a year in the property plus a guaranteed Easter or Christmas Holiday break every 3 years. A guaranteed 2 weeks during school holidays will also be on offer.
• Each owner will be able to on-sell their share at any time, rent out their share separately or place it in the letting pool.

Chatswood Interchange update (AFR Pg.46)

• Galileo Group, Mirvac Group and Meriton are believed to be in the running to purchase the $450 million Chatswood Interchange residential project.
• The site has approval for 3 towers with a total 509 units.
• No additional section 94 contributions are required and the car park for 494 cars is partly completed.

343 George Street, Sydney CBD update (AFR Pg.47)

• The City of Sydney is believed to be undertaking due diligence to purchase 343 George Street in the Sydney CBD for approximately $78 million.
• The vendor, Abacus, purchased the property for $55 million from DEXUS Property Group in October 2009.
• Since the 2009 transaction Abacus signed Burberry to the street level space and offices on the fourth floor on a 15 year lease.
• DEXUS has a 5 year lease in the 10 level building.

Liverpool commercial sale (AFR Pg.56)

• A 2 level office building at 50 Macquarie Street, Liverpool sold for $5.1 million on a 9.6% yield.
• The 2,500m² ($2,040/m²) site has 2,358m² ($2,163/m²) of lettable area.
• Tenants include National Australia Bank and the Australian Red Cross Society.
• The annual income is $491,000.

Sydney CBD strata office sale (AFR Pg.56)

• A 274m² ($6,387/m²) office strata unit on level 9 in the Alliance Francaise Centre at 257 Clarence Street in the Sydney CBD sold for $1.75 million to an owner occupier.

Sydney CBD leases (AFR Pg.53)

• The Commonwealth Property Office Fund has leased 2,453m² of space to Bendigo and Adelaide Bank at 175 Pitt Street in the Sydney CBD for 5 years.
• This is the first lease for the building following a refurbishment. Space in the building was placed on the market in February.
• JPMorgan has extended part of their lease until July 31, 2012 and another portion until September 30, 2012 in the fund’s 225 George Street building in the Sydney CBD.

Sydney market update (AFR Pg.48)

• Between 2010 and 2012 capital values for core prime office properties in the Sydney CBD are forecast to grow by an average 10% annually.
• Net rent for grade-A warehouse space is expected to grow by an average 2.7% between 2010 and 2012. Capital values are anticipated to rise by 5.8% this year, 6.5% in 2011 and 9.5% in 2012.
• Retail values are also forecast to increase.

GPT’s Sydney Olympic Park plans (AFR Pg.48)

• GPT Group will go ahead with a $60 million campus-style office precinct in their Sydney Olympic Park development.
• The proposed 12,200m² facility will be speculatively built. The building will have 2,500m² floor plates.
• The development will be the first under the Sydney Olympic Park 2030 master plan.
• The master plan for the entire site allows for 60,500m² of campus-style office space.

Huntingwood industrial sale (AFR Pg.56)

• The unlisted Heathley Diversified Property Fund has sold an office and warehouse at 24 Healey Circuit in Huntingwood to Marinucci Packaging for $5.45 million.
• The 10,260m² ($531/m²) site has 285m² of office space and 4,495m² of warehouse space.

Merrylands Mall update (AFR Pg.47)

• Stockland Group has received council approval for the final 2 stages of their $390 million redevelopment of Merrylands Mall.
• The new stages will add 32,674m² of space and the additional car spaces will bring the total to more than 3,000.
• Tenants include Big W, Kmart, Target, Coles, Woolworths and Franklins.

Croydon showroom sale (AFR Pg.56)

• A vacant 2 storey showroom at 128 Parramatta Road, Croydon sold for $1.482 million.
• Improvements to the 808m² ($1,834/m²) block total 600m² ($2,470/m²).

• Hotel Grand Central has purchased the Courtyard by Marriott at Surfers Paradise for $47 million.
• The 31 level, 4-star hotel is above the Centro Surfers Paradise shopping centre.
• The hotel has 405 rooms ($116,049/room), a restaurant, 2 bars, 5 conference and meeting rooms, a gym and a pool.
• The hotel will be renamed the Hotel Grand Chancellor, Surfers Paradise.
• Marriott Vacation Club purchased the hotel in 2008 for $36.5 million ($90,123/room) from receivers.

Brisbane motel sale (AFR Pg.56)

• The Wynnum Anchor Motel in Adam Street, Brisbane has sold for $1.7 million.
• The new owner plans to redevelop the 11-room ($154,545/room) property in the future.

Victoria Property

Melton North precinct structure plan approved (AFR Pg.47)

• Victorian Planning Minister Justin Madden has granted Melton Shire Council approval for their Melton North precinct structure plan.
• The plan includes 1,300 homes, a town centre and leisure facilities on a 100 ha site at Melton North.

Dandenong South industrial sale (AFR Pg.56)

• An owner occupier has purchased Carpet Court’s Melbourne distribution centre at 29 Kitchen Road in Dandenong South for $2.225 million.

St Kilda sale (AFR Pg.56)

• A residential developer purchased a corner retail and office property at 46 – 52 St Kilda Road, St Kilda for $3.3 million.
• The 740m² ($4,459/m²) site has 3 ground floor shops and offices upstairs.
• The property is leased until mid-2012 for approximately $83,000 p.a.

Castello pub portfolio update (AFR Pg.48)

• The Dominion Hotel Group has purchased Sam Castello’s 11 gaming pubs for just under $80 million.
• The pubs include the Anglers Tavern in Maribyrnong; the Foresters Arms Hotel, Oakleigh; the Kealba Hotel; the Croydon Hotel and Castello’s Pakenham Hotel.
• The Castello Group purchased 654 gaming entitlements for just over $24 million in a recent poker machine auction.

The Whalers Inn sale (AFR Pg.48)

• Graeme Roger has purchased The Whalers Inn at Warrnambool for $5.1 million.
• The pub has 34 poker machine entitlements which allow the holder 10 years of machine operation, effective from 2012. The entitlements sold for $130,500 each.
• The pub was part of Rick Munday’s pub portfolio which was placed in receivership in April.

National Property

Residential rental update (AFR Pg.46)

• In the 3 months to June rents for units only increased by 1.4%. Houses did not record any increase.
• For more than a year quarterly rental increases have been approximately $10 a week, well below the average quarterly gain of $80 a week for houses and $95 a week for units recorded between 2006 and 2008.

Office update (AFR Pg.53)

• In 2009/10 $6 billion in office sales occurred, up from the $4.8 billion in the previous year.
• The number of sales declined from 276 to 239.
• In Victoria $1.4 billion of assets exchanged hands.

Retail update (AFR Pg.49)

• In the first half of 2010 retail asset transactions totalled $2.05 billion. In calendar 2009 sales totalled $2.5 billion.
• Sales in WA, NSW and the ACT have surpassed the 2009 full-year totals.
• The WA market recorded nearly 40% of the sales.
• NSW transactions totalled $428.7 million.

Hotel update (AFR Pg.50)

• In the first 6 months of 2010 sales of hotels and resorts totalled $656 million. During the same period in 2009 sales totalled $103 million.
• Asian investors accounted for 83% of all sales.
• Sydney had the highest level of activity with 4 sales, followed by Brisbane, Perth and Surfers Paradise.
• Revenue per available room was up by 15.7% and 12% in Canberra and Sydney respectively.