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Vol 11. No.31

Economic Overview

	Current	+/-	Movement
$AUS/$US	88.67	-0.34
Cash Rate	3.75	Steady
90 Day Bill	4.18	-0.06
10 Year Bond	5.470	-0.045
ASX 200	4545.5	-16.6

NSW Property

Sydney office tower sale (AFR Pg.54)

• City Freeholds has acquired 55 Hunter Street, Sydney from Industry Superannuation Property Trust for $106.1 million ($7,764/m²) reflecting an initial yield of approximately 7%.
• The building includes 17 levels of A-grade office space, three levels of split-level basement parking and ground floor retail space.
• The building is fully leased and has a total net lettable area of is 13,666m².
• The move by City Freeholds comes as The Sydney Metro Authority is set to purchase its 12 Castlereagh Street, Sydney property.
• Sydney Metro have plans in place to acquire up to $300 million worth of Sydney CBD property for its first stage of its multi-billion dollar rail system.

Barangaroo Update (AFR Pg.55)

• PricewaterhouseCoopers could move its Sydney based office into the $6 billion Barangaroo development.
• The company is one of more than 30 leading businesses that have expressed interest into the new harbour front precinct in which flexible floor plates of over 2,000m² are being offered.
• Lend Lease won the right to construct approximately 350,000m² of office space in Barangaroo and aim to have the first tenants secured by July – August once the master plan has been approved.
• Last year Lend Lease quoted 30% of the office space to be developed had been pre-committed.

Queensland Property

Brisbane office tower sale (AFR Pg.54)

• GDI Property Group has purchased 10 Market Street, Brisbane for $34.25 million ($4,998/m²) from Heathley Diversified Property Fund.
• The property has a total net lettable area of 6,853m² and with more than 30 tenants the initial return exclusive of reversionary rents is approximately 10%.
• Heathley purchased the property in 2003 for $23.7 million.

National Property

Construction cost update (AFR Pg.54)

• Construction costs are predicted to slightly increase in 2010.
• Industry professionals expect construction costs to rise 2% in Canberra, Sydney & Perth.
• Costs in Brisbane will remain firm while Melbourne (1.5%), Adelaide (3%), and Darwin (4%) are expected to rise throughout 2010.
• Labour, materials and fuel costs are expected to remain steady.