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Vol 11. No.91

Economic Overview

	Current	+/-	Movement
$AUS/$US	87.73	-1.87
Cash Rate	4.50	Steady
90 Day Bill	4.86	+0.03
10 Year Bond	5.470	-0.040
ASX 200	4467.2	-143.9

New South Wales Property

• The NSW Government has rezoned the Riverstone and Alex Avenue precincts of the North West Growth Centre. Planning Minister Tony Kelly indicated that the land would accommodate 45,000 residents, six schools and recreational facilities.
• However critics have suggested that fragmented ownership of the land, infrastructure levies and taxes would make development difficult.
• The government has indicated that it would provide infrastructure including the Quakers Hill to Vineyard rail duplication, trunk water and sewer facilities and major road and electricity upgrades.

Project assessment time cut (AFR Pg.56)

• The NSW Governments new Joint Regional Planning Panels have halved the time it takes to assess projects valued at over $5 million.
• NSW Planning Minister Tony Kelly said the average time for applications to be determined for regionally significant development proposal by the JRPP was 114 days, substantially less than the 249 days averaged in 2008-09.

Queensland Property

Santos Place and Waterfront Place bids (AFR Pg.51)

• Eleven bids have been made for two Brisbane CBD office towers currently being marketed for sale.
• Santos Place at 32 Turbot Street received 5 bids. The six star Green-star building is owned by private developer Ross Nielson and could fetch as much as $300 million.
• Additionally, an unlisted Stockland fund is offering a 50% share in Waterfront Place, which was last valued at $217 million. Waterfront Place is one of only three premium office buildings in the Brisbane CBD.
• Recent large transactions in the Brisbane CBD include the Commonwealth Property Office Funds purchase of King George Central, 145 Ann Street for $210 million from Leighton Properties, K-REIT Asia’s purchase of a half share in Charter Hall’s 275 Gorge Street for $166 million and Swiss based AFIAA’s purchase of HQ South for around $95 million.
• Sources suggest the bids for Santos Place and Waterfront Place have indicated yields around the 7.5% mark.

Centro Hervey Bay due diligence (AFR Pg. 18)

• Diversified property company, Stockland is understood to be in due diligence to purchase Centro Hervey Bay in deal believed to be worth around the $70 million.
• The Centro Hervey Bay is jointly owned by the unlisted Centro Australia Wholesale Fund and Bob Ell’s Leda Holdings.
• The centre caters to a main trade area of 88,000 residents and has a GLA of 15,596m² with 992 parking spaces.
• Major tenants include Supa IGA, Target, Coles and Kmart. The centre has 48 specialty stores.

Victoria Property

Burwood Square development update (AFT Pg.52)

• Cinema operator Reading International has abandoned plans to launch the $600 million Burwood Square development in Melbourne. The site has been listed for sale.
• A development plan for Burwood Square was approved in late 2008 by Whitehorse Council.
• Reading has permission to develop a mixed use project with residential, commercial and retail aspects along with a 17 screen cinema complex.
• It is reported that the development would span 700 households, 20,000m² of office space, a 3,000 seat cinema complex, a 10 lane bowling alley, a gym and a child care centre.
• The 50 acre property was acquired in 1996 and has been carried on Readings books at $46.7 million.

Education sector remains strong in Melbourne CBD (AFR Pg.53)

• Industry sources suggest that education sector continues to have a major bearing on Melbourne’s office market with the amount of office space leased to educational institutions nearly doubling in the past five years to more than 180,000m².
• Marketing agents indicate that leasing enquiry from the education sector has remained strong despite the recent global economic downturn and it is believed that the sector would continue to grow as Western education remained a priority for people in growing Asian economies.
• Recent deals include Discover English leasing 943m² in 376 Bourke Street, Performance English leasing 1,016² over two levels in 277 Flinders Lane and Think Education who leased 508m² at Investa’s 485 La Trobe Street.