Listed Property Trusts

[The Great Gold Guru]

Those are really solid numbers ... could be worth a flutter!

[fungus pudding]

Those are really solid numbers ... could be worth a flutter!


But ....debt, debt, debt, debt..........it's so out of line with the other listed trusts, that if they have to reduce leverage (and they will one day) they'll get walloped. As CEO says selling buildings to repay debt leaves them worse off profit wise - and raising capital will be impossible at current debt levels. I don't see dividends staying up for too long, although they predict them holding for next year.

[fungus pudding]

From Otago Daily times

http://www.odt.co.nz/news/business/65810/confidence-listed-property-growing

[Grimy]

I haven't gone back too far on this thread (as things change), but a quick look at a few of these gives approximate figures of;

GMT @.99 a 10% div and a 5% discount to NTA
KIP @ .99 a 8% div and a 25% discount to NTA
ING @.69 a 11% div and a 40% discount to NTA
APT @.77 a 9% div and a 43% discount to NTA

I have MFL units from a long time ago - which if I'm right is basically ING Prop? If so I probably don't need more exposure there. However, I've always been keen on KIP and APT, just never bought any as I've usually not had any spare money. However, I have had some finance company money repaid (yes, there are still some that haven't collapsed!) and thought either APT or KPI, or a mix wouldn't be a bad way to go for a reasonably steady (if somewhat unexciting) income/investment.
Any particular reasons not to at present?
Thanks.

[fungus pudding]

I haven't gone back too far on this thread (as things change), but a quick look at a few of these gives approximate figures of;

GMT @.99 a 10% div and a 5% discount to NTA
KIP @ .99 a 8% div and a 25% discount to NTA
ING @.69 a 11% div and a 40% discount to NTA
APT @.77 a 9% div and a 43% discount to NTA

I have MFL units from a long time ago - which if I'm right is basically ING Prop? If so I probably don't need more exposure there. However, I've always been keen on KIP and APT, just never bought any as I've usually not had any spare money. However, I have had some finance company money repaid (yes, there are still some that haven't collapsed!) and thought either APT or KPI, or a mix wouldn't be a bad way to go for a reasonably steady (if somewhat unexciting) income/investment.
Any particular reasons not to at present?
Thanks.

Don't overolok the fact these are pie returns - no need to include in tax return . And don't forget about KPF. Far too cheap.

[Grimy]

Don't overolok the fact these are pie returns - no need to include in tax return . And don't forget about KPF. Far too cheap.

With not many properties and the occupancy rate and length of leases I'm just a little uncomfortable on this one. Discount is certainly impressive though. But think I'd sleep better with one of the larger funds.

[Billy Boy]

YO F/Pud...
You are for a Directorship this time around ??
Two spots going
Cheers BB:)

[fungus pudding]

YO F/Pud...
You are for a Directorship this time around ??
Two spots going
Cheers BB:)


Sorry, no can do. I'd like to be a director, but unfortunately my suit has shrunk while hanging in the wardrobe.:D

[BRICKS]

Well the KIP made it to the $1.00 up from 90 cents this little stock has been a good BET..

WHO missed.. out..

[Grimy]

Well the KIP made it to the $1.00 up from 90 cents this little stock has been a good BET..

WHO missed.. out..

Me, went with APT who are also going in the right direction though.
Still watching KIP for any dip.

[Billy Boy]

Me, went with APT who are also going in the right direction though.
Still watching KIP for any dip.

ING & GMT Could be movers this week/Month
Divvy due Sept.
BB:)

[777]

Worth a read.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10598950

[Billy Boy]

Some one has a big "u" on the sell side of the stackings and
has had it there for some time now. WHY ???
This is effectively holding the SP down. Why would you do that.
It's gotta be an insto of some sort who needs ready's right now
but why not drip feed ??
anybody ???
BB:)

[GR8DAY]

BB............which stock are u referring to??

[Billy Boy]

BB............which stock are u referring to??

GMT.NZX - Goodman Property Trust Ordinary Units
bb:)

[Billy Boy]

And now some Mutton-Head has put the big "u" at 101 !!!
sell @ 100 must just about be used up.
vol 1,966,772$1,966,459

at 0100pm
Geeez Wayne :confused::confused:
BB

[Billy Boy]

And now some Mutton-Head has put the big "u" at 101 !!!
sell @ 100 must just about be used up.
vol 1,966,772$1,966,459

at 0100pm
Geeez Wayne :confused::confused:
BB

Ahhhh.... finally we got an announcement
BB:)

[underground]

ING is currently in a trading halt.. any ideas?

[Ash]

http://www.sharechat.co.nz/article/db6a1003/anz-to-mop-up-the-rest-of-ing.html

ANZ buying 51% of ING Aust and NZ operations

[underground]

any insight as to how this may affect the trust or its shareprice?

possibly a rename of the trust?

and obviously debt covenants/access to lending facilities will not be an issue any more?

also the takeover of MFL Mutual fund from ING's maangement would mean that INZ is also the manager and a substantial shareholder. hopefully ANZ will be wanting a higher yield to make up for their billion dollar investment meaning hopefully for us minority shareholders get more from this deal also?

i guess a negative may be a different risk profle stemming from the banking sector?

any thoughts would be much appreciated..

[Billy Boy]

I think its a good thing...
Gives the trust a cornerstone share holder with some clout.
Probably allows better decisions to me made by management as
only Australasian influenence's & mind-sets will be in play.
Two Tear Marketing ("we will leand you the $$$ if you lease this property)
One Stop Shop for Bizz operators/starters.
Maybe a better play into O/Seas markets.
...
Down side
ANZ could try to bleed the Property Trust for its own interests...
Allow the Trust to stagnate.
Dilute the shares overtime (through DRP (no buy backs))
....
Will be interesting....
I am not saying all of the above will happen, just opening the debate.
cheers to all
BB :)
Dis... have a large holding... at this time !!!

[COLIN]

I hold units in several of the LPT's - principally APT and GMT, but with smaller holdings in NAP, KPF, and ING. The sector is in a recovery stage; of the whole, and looking at the charts etc., I believe that ING offers the best prospects at this point and I intend to increase my weighting accordingly. As to whether the ANZ takeover offers any positives, I couldn't really say. They are retaining the present team, but people can move on of course.

[Billy Boy]

I hope ING & ANZ can come out very quickly with
some sort of assurance to unit holders as to future
direction. Of course they are bound by the Trust
Deed, But that can be amended along with the
management team. Hopefully both will remain intact
as is. Either way they need to say so, IMO.
I am wondering what MFL are thinking at this stage ???
BB :)

[underground]

I believe that ING offers the best prospects at this point and I intend to increase my weighting accordingly.

I also agree, i predicted the upward move back to historical support at 80c..i believe the share price should be at around 90c which gives investors who buy in at that price an 8.3% return on dividends alone which can be pretty attractive if bank deposit rates continue to be dismal.

as for the recovery in the sector, if property values rise again then NTA will increase and inevitably sp will go up.. i feel like the market has largely been ignoring ing for a while now and only just has come back to it.

the next sets of financials under ANZ's management will be interesting, things of interest may be change in auditors or any related party transactions..

Also interesting to note is that ANZ/ ING have reduced there exposure to GMT..which i think is a good sign if they eventually sell out as it shows they are confident with their own LPT's performance.

and billy im sure in the current environment MFL are just hoping they will still have their jobs :confused:

discl: hold a lot of ING, am in it long-term for the yield.

[Billy Boy]

What the hells going on here ??:confused:
Bids Ask
u0 8 100 101 4 u0
u0 16 99 etc....
etc....
I know what the u0 means
but both ends ???
Cheers BB :confused:

[fungus pudding]

I see DNZ have suspended trading on their shares through Unlisted until the possibility of listing on theNZX is evaluated. Seems to me that they will list soon. Be interesting to see what they will trade at if they do.

[Snapper]

I suspect DNZ will trade at around their current level 40-45 cents until they get their debt sorted out.

Disc: Hold DNZ

[Billy Boy]

DNZ Asking for expressions of interest, got my letter yesterday
Hope they put money toward lowering debt.
Would be a good buy if they do.
BB:)

[fungus pudding]

DNZ Asking for expressions of interest, got my letter yesterday
Hope they put money toward lowering debt.
Would be a good buy if they do.
BB:)


Why would it?
We don't even know the price.
Any issue of shares at below the net asett backing will dilute the intrinsic value of the shares you already hold; and they sure as hell will be well below the NTA.
But you can be assured that funds will be used to reduce debt, because they would be crucified if they list with current debt level.
I'd prefer to see them stagger on unlisted for a while, even if they reduced dividends for a while to repay debt.
I doubt that I'd buy anymore in a new issue, although I'll await details. I already own 312,000 and don't see much point in helping to cut my own throat.

[Billy Boy]

F/Pud
I agree with your thoughts of going on the unlisted for a while, coz
in my view, if they were to go straight to the main board they would
loose SP value fairly quick because of their debt (Around 40%).
I have indicated that I would be interested in buying a further $50K
(depending of course), but if they came in too cute then I would wait
and buy 'on market' as the SP would be that much less.
When they do go, and I feel they will have too, they must consider
the other players already on the Board. The old story :- Have this
much $$$, whats the best I can do with it.
NAP are getting their dept down (along with the others) and now
are looking quite good price wise. I dont hold NAP, but they are getting
there. So NAP or DNZ..... right now ? ....Flip.
DNZ have great properties in good locations, but OH!! that bloody
gearing ratio. too big in my view for todays envinorment.
Still as you say "they will use the money to lower gearing" so lets
see what the deal might be. I dont envy them (the directors) in their
quest & I hope like hell they pull it off. Lets see what they come up with.
Cheers BB:)
PS I loaded up on LPT's a ways back with a good cap gain in veiw.
Now the cap gain is comming in and I dont want to sell coz of the
cash flow. Geez BB I new that would happen and did'nt listen to myself
:D.

[fungus pudding]

F/Pud
I agree with your thoughts of going on the unlisted for a while, coz
in my view, if they were to go straight to the main board they would
loose SP value fairly quick because of their debt (Around 40%).
I have indicated that I would be interested in buying a further $50K
(depending of course), but if they came in too cute then I would wait
and buy 'on market' as the SP would be that much less.
When they do go, and I feel they will have too, they must consider
the other players already on the Board. The old story :- Have this
much $$$, whats the best I can do with it.
NAP are getting their dept down (along with the others) and now
are looking quite good price wise. I dont hold NAP, but they are getting
there. So NAP or DNZ..... right now ? ....Flip.
DNZ have great properties in good locations, but OH!! that bloody
gearing ratio. too big in my view for todays envinorment.
Still as you say "they will use the money to lower gearing" so lets
see what the deal might be. I dont envy them (the directors) in their
quest & I hope like hell they pull it off. Lets see what they come up with.
Cheers BB:)
PS I loaded up on LPT's a ways back with a good cap gain in veiw.
Now the cap gain is comming in and I dont want to sell coz of the
cash flow. Geez BB I new that would happen and did'nt listen to myself
:D.


Probably the most underpriced at the moment is Kermadec if you're bargain hunting.

[Billy Boy]

Probably the most underpriced at the moment is Kermadec if you're bargain hunting.

>>>>;)<<<<<

[fungus pudding]

>>>>;)<<<<<


Translation?

[777]

Translation?

He thinks the same I guess.

[Billy Boy]

Translation?

Quietly accumulating ;) 777 right on !!!
BB:)

[fungus pudding]

DNZ Asking for expressions of interest, got my letter yesterday
Hope they put money toward lowering debt.
Would be a good buy if they do.
BB:)



http://www.stuff.co.nz/sunday-star-times/business/2973080/No-easy-path-to-property-float

[Billy Boy]

Morning F/Pud
Tks for the News clip. The finial bit echo's our fears.
Do you think this GREG NINNESS report type person, reads
our forum ??
BB:)

[fungus pudding]

Morning F/Pud
Tks for the News clip. The finial bit echo's our fears.
Do you think this GREG NINNESS report type person, reads
our forum ??
BB:)


We should send him a bill - just in case he does.:D

[777]

I see a trade of 9,500,000 shares in APT show up this morning as a late trade for Friday.

[Billy Boy]

I see a trade of 9,500,000 shares in APT show up this morning as a late trade for Friday.
Probably ACC bailing...
But who bought ? Cullen fund ?
The announcement due,.... when ???
Cheers BB

[troyvdh]

Mcdougal stuart have come out with a "sell" today on PFI partly because of its gearing of 43%....."below its maximum"....Mr Blackmore is confused..as am I..he said they have used the mkt cap as oppposed to asset value..but even that does not make sense.....in its report...debt ratio is stated at 28%.....weird eh....

[GR8DAY]

......Take a look at National Property Trust (NAP) if you want a sfer bet. Gearing now down to around only 23%!!.......a very safe bet in my opinion and returning around 9% in your hand......no tax to pay! ( the equivalent of 12-15% gross )

[Billy Boy]

......Take a look at National Property Trust (NAP) if you want a sfer bet. Gearing now down to around only 23%!!.......a very safe bet in my opinion and returning around 9% in your hand......no tax to pay! ( the equivalent of 12-15% gross )

SHHHHHH........ or everyone will catch on and the SP will climb.
BB:D

[777]

Can not see much point in taking up the MCN issue in KIP. A mere 2,857 notes for every 100,000 units you hold. Better to just invest the same amount in existing units instead or do nothing at all.

[Billy Boy]

Can not see much point in taking up the MCN issue in KIP. A mere 2,857 notes for every 100,000 units you hold. Better to just invest the same amount in existing units instead or do nothing at all.

I agree
KIP need to lower debt IMO.
Why buy KIP when you can do better with the money.....
Nap. Kpf. Gmt. Ing......
BB:)
Dis Dont Hold Kip

[Billy Boy]

The Trust will pay a net distribution of 1.875 cents per unit. Its components are: - a fully imputed distribution of 0.6633 cents per unit with imputation credits of 0.199 cents per unit attached; and - an excluded distribution of 1.4107 cents per unit.

Now thats handy :):)
BB:)

[beacon]

Yes, but income has slid. They should clarify their distribution policy and payout ratio for next year, if they wish to support price. Big selling currently on...

[fungus pudding]

Yes, but income has slid. They should clarify their distribution policy and payout ratio for next year, if they wish to support price. Big selling currently on...


They all seem to have dropped then recovered in the last few days. Don't know why.

[beacon]

They all seem to have dropped then recovered in the last few days. Don't know why.

The way I read it: Recession impact concern long term, Dividend season immediate term
http://www.stuff.co.nz/business/industries/3135980/Debts-threaten-small-NZ-firms
Expecting prices to soften again. ING has the best value based on NTA among majors, but their silence on expected earnings and distribution for next fin yr will weaken price further. Estimating is difficult in the current climate, but the impact of recent sales on earnings needs to be clarified and communicated. Diversified portfolio is their strength but their past record at communication, distributed set of properties vs say GMT, remaining asset quality and ING brand does not inspire confidence at the moment, particularly as we await Xmas results. Maybe they could take a leaf out of GMT's recent property tour organized for investors ...

[troyvdh]

..it would appear that everyone loves kip.....how come then that kip is trading at 1.02..nta is 115...yield 7.84.....and yet pfi is trading at 120..nta..is 112....yield is 5.92....is kip more sexy....just a thought....but having said that the thought of going to a place like Sylvia park....sticking pins in my eyes would be more enjoyable....

hold pfi

[fungus pudding]

..it would appear that everyone loves kip.....how come then that kip is trading at 1.02..nta is 115...yield 7.84.....and yet pfi is trading at 120..nta..is 112....yield is 5.92....is kip more sexy....just a thought....but having said that the thought of going to a place like Sylvia park....sticking pins in my eyes would be more enjoyable....

hold pfi

Obviously kip is less appealing, not moreso. Why is PFI so popular? Beats me.

[voltage]

should westfield be part of a property portfolio, you cannot access franking credits, is this likely ever to change?

[scamper]

fungus pud, i think pfi pays divis quarterly -- a big plus for some investors. cheers.

[fungus pudding]

fungus pud, i think pfi pays divis quarterly -- a big plus for some investors. cheers.


So do most others. KPF, ING, APT, GMT. off top of my head. . I think KIP is the only exception. Doesn't tell me why pfi sells at low yield when there seems better options.

[whirly]

Hi Fungus

5 reasons I like PFI

1.PFI specialises in industrial property investment. I don’t like office blocks, retail or apartments. This rules out particularly KIP and APT for me.
2.Invest in multi-purpose, rather than specialised properties.
3.Peter Masfen, chairman.
4.debt currently 29.3% of total tangible assets
5.Continued high occupancy 98.9%

All in all I suspect others that like PFI also like it for the industrial factor.

Whirly

Disclaimer – hold no LPT’s but considering PFI.

[GTM 3442]

Hi Fungus

5 reasons I like PFI


Whirly



And the 6th reason is that the DRP is not new shares, but bought on market - no dilution.

[fungus pudding]

And the 6th reason is that the DRP is not new shares, but bought on market - no dilution.

I wasn't aware of that. Thanks. I'll buy some.

[fungus pudding]

Cliche count at Dunedin presentation of the ING annual investor update. First speaker, Stuart Harrison, came out with four 'going forwards'.
Second speaker, Peter Mence, used 'going forward' five times.
Although I wouldn't declare Peter the outright winner, as Stuart managed a brand new variation 'rolling forward' This is approximately half the 'going forwards' counted at the 2008 presentation. .:D:D:D


Just returned from the annual ING presentation in Dunedin. 2010 count showed 'going forward' still the outright winner with 12 appearances. 'The reality is' was a distant second with only three appearances. 'To be fair' and 'As we speak' were not used at all. Suprising oversight there, but bound to be included in next year's presentation.

[macduffy]

Sounds like great entertainment, fungus.

Any clues as to what might, or what might not be, good investments in this sector?

[fungus pudding]

Sounds like great entertainment, fungus.

Any clues as to what might, or what might not be, good investments in this sector?


I reckon those that are heavily discounted to NTA, and that certainly includes ING. PFI and GMT are ok but aren't bargains and I have never liked APT - 'cos office buildings are worse than residential stuff.

[loofa]

I reckon those that are heavily discounted to NTA, and that certainly includes ING. PFI and GMT are ok but aren't bargains and I have never liked APT - 'cos office buildings are worse than residential stuff.
ING still has some lower value investments that it can sell on to sucker privates/family trusts.
GMT has much larger but also built-for-purpose units so its rent roll is stickier than most.

[Billy Boy]

KPF is worth taking a look at. Better positioning than first mees the eye.
Not much debt.
But small, then does that really matter ??
BB :)

[fungus pudding]

KPF is worth taking a look at. Better positioning than first mees the eye.
Not much debt.
But small, then does that really matter ??
BB :)

I agree. Seems a screaming bargain to me. Has been for ages.

[Billy Boy]

A long shot I know !
A good takeover for ING ???

[fungus pudding]

A long shot I know !
A good takeover for ING ???

Can't see it. ING have been selling off cheaper properties. I think there's a place for KPF and possibly NAP. They seem to be in the cheaper end of the market - while GMT,ING, KIP, seem to try and impress the market with the big and glossy stuff. But there's plenty good pickings in lower grade properties. Sometimes better. At least these smaller companies can sell of their holdings if they want to relatively easily, but if the market is down then the really expensive buildings, malls etc can't really be sold except to other listed trusts who will be in the same boat. An assortment of big and small lpts seems sensible to me. But a lot depends on your goals. I'm not a sharetrader; just a real estate investor with a bit of an interest in these trusts as well as my own buildings - so I buy to keep - or in other words just for the income. The shares get chucked in the corner and someone will get them when I kick the bucket.

[Billy Boy]

I went to the Invergumboot presentation. Only about 12 people there.
They did'nt say much that we did'nt allready know.
However One guy asked "what sort of hit will the ING's Div take if the depreciation
clause is lifted by Billy Smurf". The answer was .4 of a cent. Then a bit of discussion
about Land Tax. "Wont happen" was the answer. This guy seamed to think it could in
selected cases. Interesting......
If ING Div gets knocked by .4 of a cent then I wonder what the others will suffer by.
You got any idea ??
cheers BB :)

[rmbbraver]

Sylvia Park mall aims to get a lot bigger
4:00 AM Wednesday Apr 14, 2010
Kiwi Income Property Trust has big plans for Sylvia Park. Photo / Doug SherringParties have just under three weeks to voice opinions about development around Auckland's $452 million Sylvia Park mall.

The Auckland City Council last month notified Kiwi Income Property Trust's plans to build in and up on land around its Mt Wellington mall and has called for submissions by April 30.

Kiwi wants to build a mass of offices and apartments around the 71,057sq m mall and already has permission to double the size of buildings on the site and put up 148,000sq m, expanding the existing floorspace by 76,943sq m.

But it wants that pushed out to 250,000sq m. The final 50,000sq m of that will be residential apartments.

The mall at 286 Mt Wellington Highway generates about $27 million of annual rent and has 4002 carparks.

Kiwi says this is New Zealand's largest shopping mall and that it always planned to take advantage of big plots of vacant land surrounding the long, low thin mall.

It also wants to build far taller than it is allowed and 20-level buildings could rise there soon if its plans are approved.

Sylvia Park project director Andrew Buckingham said further stages of development had been planned for some time and it was heartening that Sylvia Park featured with Onehunga and Newmarket as one of three "principal centres" of Auckland's future.

Sylvia Park's motorway, bus and train connections made it ideal for growth, he said, indicating that mall workers might be forced to bus or train to the site.

"It has now been more than a decade since planning commenced to transform the Sylvia Park site from a collection of run-down World War II storage sheds into a comprehensively planned town centre," Buckingham said. "Since October 2004, when construction started, Kiwi has invested approximately $400 million into Sylvia Park."

Now, it wants to build on the approximately 17ha of vacant land surrounding the mall, which is positioned near the centre of the 24ha site, flanked by a railway line and two motorways.

Kiwi wants height restrictions lifted, enabling it to build 20-level buildings, or up to 60m.

With its existing 71,057sq m valued at $452 million, the completion of 250,000sq m of buildings on the site could be worth about $1.54 billion. Shops are valued at much higher levels than offices or apartments but Kiwi has grand plans for its land, which it owns freehold.

It only has permission now to build up from 15m to 24m, equating to about eight levels.

Kiwi's application says it wants to increase maximum permitted heights from 15m with permission to go up to 30m, to 24m with provision to go up to 60m.

Office blocks are planned along the Mt Wellington road frontage in an area now used for mall carparking. Two blocks are up but Kiwi has sought planning permission for a further two.

Buckingham said experts who Kiwi had employed had backed the plans for intensification.

"The plan change request is supported by comprehensive expert reports covering traffic, parking, urban design, landscape and visual, open space, retail and engineering.

"Particular attention has been given to ensuring that future developing is carried out in a manner that minimises adverse effects in terms of traffic congestion.

"It is proposed to ensure that public transport use is encouraged by controlling the number of parks available to staff and through implementation of travel management plans," Buckingham said.

Early in its life, the mall caused an outcry against Kiwi. Some institutional investors were angered by the unspectacular long-term yield from the development and complained about risks involved.

They eventually forced the manager to make concessions, agreeing to manage the project "at cost".

ING (NZ) investment manager Craig Tyson thinks Kiwi is unlikely to develop at Mt Wellington without significant tenant leasing pre-commitments.

He noted Auckland officials had earmarked Kiwi's site as a new town centre but said timing rather than any immediate plans to dig might have motivated Kiwi to get its plan change application in now.

"I just don't think it's going to happen anytime soon," he said, adding that the rents needed to justify the development expansion could well price them out of many tenants' reach.

Market speculation some months ago was that Inland Revenue was examining relocating to either Sylvia Park or Highbrook.

"Ultimately, I think it would be a good location for offices and it would certainly increase the foot-flow through the centre, which is what all mall owners try to do. I just can't see it being economic anytime soon given where economic rents are," he said.

Forsyth Barr analyst Jeremy Simpson issued a note on Kiwi's prospects this month after its portfolio value fell by 0.5 per cent.

Weaker office market rents were mostly to blame for value drops, he noted.

Kiwi announced a $74 million or 3.9 per cent fall in its portfolio to $1.85 billion for the year to March 31, 2010, he noted. However, valuations only fell 0.5 per cent or $8.7 million in the last six months. That was a very encouraging sign for the property market, Simpson said.

"While Kiwi noted that cap rates have stabilised in the office portfolio, valuation falls were a result of the weaker outlook for market rents.

"These falls were offset by some gains in the retail portfolio over the last six months, in particular at Sylvia Park in Auckland and the redeveloped Plaza Shopping Centre in Palmerston North.

"We are concerned that the CBD office market will remain weak for a while as detailed in our listed property outlook published on March 25, due to expected significant increases in vacancy rates over the next three years and further pressure on market rents.

"The office sub-sector is typically the last to recover from a property cyclical downturn. Once it stabilises, it can take many years until real and sustained growth in market rents returns. Kiwi's large and unique portfolio of major shopping centres (around 60 per cent of its portfolio) will continue to help offset office weakness," he said.

Kiwi had defensive cashflows and it remained one of Forsyth Barr's preferred listed property vehicles with its focus on tightly-held prime retail, office assets and its long-term bank facilities.

"Sylvia Park has been a successful development and Kiwi's prime CBD office portfolio is relatively sound given its low vacancy," Simpsonsaid.

"However, vacancy and rent review risks will remain for CBD office property for some time," he said.

SYLVIA PARK * Where: 286 Mt Wellington Highway. * Completed: June, 2007. * Net lettable area: 71,057sq m * Car parking: 4002 spaces. * Occupancy: 99.9 per cent. * Current valuation: $452m, previously $437m. * Indicative 2010 net rental: $27.8 million. * Railway station and bus interchange. * Major Tenants: The Warehouse Extra, Pak'n Save, Hoyts, Foodtown, Borders, Dick Smith Electronics PowerHouse. Source: Kiwi Income Property Trust

[rmbbraver]

Big plans for Sylvia Park
4:00 AM Wednesday Apr 14, 2010
High-rises could flank the mall. Photo / Kenny RodgerA $1 billion plan could almost quadruple the size of Mt Wellington's Sylvia Park and make it a new town hub.

The country's largest mall could soon be flanked by a new mini-city of high-rise apartment and office blocks, towering over nearby motorways.

Kiwi Income Property Trust, the $1.8 billion landlord, has sought permission to build a series of towers up to 20 levels or 60m on its 24ha site.

The public has until the end of this month to voice opinions about the plan, which would put Sylvia Park into the same league as Newmarket and Onehunga as a new city centre.

The Auckland City Council is examining plans which have earmarked the site for intensive further development.

Its public transport links are the gem which means it has big growth prospects.

The site, with its own train station and motorway offramp paid for by Kiwi, is bounded by the Southern Motorway, Southeastern Highway, Carbine Rd and Mt Wellington Highway.

Kiwi has emphasised the train station and bus interchange in its planning application, saying the site is ideally served by public transport links to minimise traffic confusion.

Not everyone is delighted about the scheme, and the community board is worried the huge buildings could create traffic chaos, dominate the area and overshadow existing traditional-style low-rise housing and key road links.

The vast 71,000sq m mall will be surrounded by tall apartment and office blocks for thousands more people if Kiwi gets approval to create its new town centre - a plan it has long held for the favourably-zoned site where only 7ha of the 24ha has been built on.

The mall's 4002 carparks are mainly spread around the shopping centre on ground level but it is those vast car-parking lots which Kiwi plans to capitalise on with its development.

Kiwi has told the council it might ban workers from driving to work. It would "manage" vehicles by insisting train and bus facilities were used, it says.

April 30 is the deadline for submissions on the plans.

Tamaki Community Board chairwoman Kate Sutton said she supported new investment and jobs but was worried about the height and size of buildings envisaged to surround the low-rise mall, which is only two levels at its highest point at one end.

Traffic management, intensification, bulk, visual domination and height are among concerns the board plans to raise with Kiwi.

Kate Sutton said the community needed to see how an expanded Sylvia Park town centre might look, and called on Kiwi to supply graphics or visual images.

"It's already difficult to get a carpark there on the weekend. Residential streets are directly across from the mall and McDonald's and Redwood Group have plans to build on sites nearby.

"Our concern is the effect on traffic, particularly on the South Eastern Highway because these buildings could be well above that."

Sylvia Park's project director, Andrew Buckingham, said no images had been made.

"As this is a plan change request there are no images of how the site might ultimately look. The plan change simply creates the planning framework to enable future development, which is of course subject to resource consent."

The mall, with carparking on a large part of its rooftop, was developed beneath the Southeastern Highway.

Kiwi's plans are at Auckland City's Greys Ave office, Auckland Central Library, Otahuhu Community Library and Panmure Community Library.

Big plans:

Sylvia Park's giant expansion:

* 24ha of now mostly vacant land

* Only 7ha of mall built there now

* 250,000sq m of buildings planned

* Towering offices and apartments

Copyright ©2010, APN Holdings NZ Limited

[troyvdh]

If I Had a choice of either sticking pins in my eyes or shopping at Sylvia park...it would be a veery close call.......and i am not joking...

[fungus pudding]

If I Had a choice of either sticking pins in my eyes or shopping at Sylvia park...it would be a veery close call.......and i am not joking...

Ah, but there's nothing like a bunch of humans to attract other humans. If you do choose the pins in your eyes option could you please post a photo (for those of us who will still be able to see)

[Billy Boy]

Yo Fungus
From where I am sitting the whole concept seams fairly exciting.
Whats your thinking ???
I might have to do another big O/e to Jaffa land.
bb

[fungus pudding]

Yo Fungus
From where I am sitting the whole concept seams fairly exciting.
Whats your thinking ???
I might have to do another big O/e to Jaffa land.
bb


Yeah - I had a wander around Sylvia park a month or so back. It was busy on a midweek day. It's obviously going to go from strength to strength, so they will always be looking to expand it. Overall it's a good thing. The biggies don't normally fail with these malls.

Next time you want to check out a shopping mall on an OE, head to somewhere in Asia. I have been super impressed with newish malls in places like Vietnam and Thailand, and even in absolute dumps like Indonesia. Can't work out how to buy a slice though.

[POSSUM THE CAT]

The One Problem with NZ Malls is they all basically the same shops. So no need to go any further than the nearest one.

[Billy Boy]

Yeah - I had a wander around Sylvia park a month or so back. It was busy on a midweek day. It's obviously going to go from strength to strength, so they will always be looking to expand it. Overall it's a good thing. The biggies don't normally fail with these malls.

Will be heading there around June, Hope to check out Highbrook (GMT) & Albany (ING) at the same time.
Might jump in the car with my valuer friend & be his pencil carrier for a bit.
Was doing some annly. on Kermadec the other day, They are looking very good for a small one. How the hell can the SP remain so low, beats me !!
Cheers BB:)

[BRICKS]

WAS just thinking today how KIP has been so steady around a $1 now for some time and did not know about the plans for Sylvia Park with such a land bank it is alway a target for growth the opening at THE PLAZA @ Parmie this month
leaves room for KIP action with there connection the ASB bank it can only go AHEAD..

[fungus pudding]

The One Problem with NZ Malls is they all basically the same shops. So no need to go any further than the nearest one.

It's the same the world over. Why is that a problem? It would be if they weren't the same and we had to go to several malls, or drive 50 kms to get what we want. The modern malls cater well for most shoppers without going to far from home.

[Billy Boy]

and did not know about the plans for Sylvia Park with such a land bank it is alway a target for growth the opening at THE PLAZA @ Parmie this month
leaves room for KIP action with there connection the ASB bank it can only go AHEAD..
I new nothing either, do now (many thanks to rmbbravers post above)
KIP have always worried me with their holdings, Office & Retail. I think thats why they have been hovering around $1 mark as both sectors are not good at the moment. Still as you say ... "Growth Stock". & large outfit

cheers BB

[POSSUM THE CAT]

Fungus Pudding The problem is you do not get what you want. You have to take what they stock or go with out. No Choice.

[fungus pudding]

Fungus Pudding The problem is you do not get what you want. You have to take what they stock or go with out. No Choice.

So who does stock what you want? If there's good demand normal retailers will be onto it. Specialist stuff is a little different, and that's as it should be. They don't need to pay mall rentals. That's destination stuff. Generally we are well catered for by stand alone retailers and mall complexes. But they will never please everyone obviously.

[Stylerz]

Can anyone tell me what the primary long term objective is of the main property trusts, especially KIP,GMT,ING?


Is it to develop properties, then increase rents to increase dividend payouts to shareholders over the years?

Or is it more focussed growing the portfolio of the company,by continously buying more properties, as the revenue increases?

Or maybe a combination of both or something else i have missed?

Thanks in advance.

[macduffy]

My own, somewhat cynical view of these companies is that their main interest is in growing the portfolio to increase the management fees for the management companies who control them.

May not apply universally but most managements are paid on the basis of the bigger the value of the portfolio, the bigger the fee. Every encouragement then to borrow and to issue capital to achieve this, not necessarily to the advantage of existing share/unit holders.

[Billy Boy]

I agree Mc duf, some what. DNZ good example
But where else can you get 9 - 10% paid qrtly after tax ?? with sp at a discount to nta.
BB

[macduffy]

I agree Mc duf, some what. DNZ good example
But where else can you get 9 - 10% paid qrtly after tax ?? with sp at a discount to nta.
BB

Granted, B B. They just don't appeal to me. I'd like to see the interests of share/unit holders and management more closely aligned.

[RRR]

My own, somewhat cynical view of these companies is that their main interest is in growing the portfolio to increase the management fees for the management companies who control them.

May not apply universally but most managements are paid on the basis of the bigger the value of the portfolio, the bigger the fee. Every encouragement then to borrow and to issue capital to achieve this, not necessarily to the advantage of existing share/unit holders.

Hi macduffy-you are spot on. Managers for managers...ING is a good example-bought many properties using debt and now selling to repay that debt!! But i do hold GMT/IMP and ING-not a lot though. Plus points are good dividend yield(PIE entity) and they offer DRP at a discount. Hoping for a price drop after may 20th-i might get some more.

[Billy Boy]

These managers seam to be a sticking point with many, including myself.
ING (now owned by ANZ and about to get a name change) I believe are
going to operate their own management team.
Why cant the others follow ? why cant they employ our own team. After
all the "management teams" do.
BB

[troyvdh]

Im being lazy here....re this lowering of the "PIE" tax to 28 %...what was the rate before.....

[777]

Lazy for two years then. 30%

[Stylerz]

Any thoughts on how many years its going to take the main property trusts to stabilise and hopefully eventually increase their dividends.?

Just reading the ING report and it looks like they are again going to slash their dividend another half a cent. Im sure also the deprciation law is going to add to this problem.

Thanks in advance

[Billy Boy]

Any thoughts on how many years its going to take the main property trusts to stabilise and hopefully eventually increase their dividends.?

Just reading the ING report and it looks like they are again going to slash their dividend another half a cent. Im sure also the deprciation law is going to add to this problem.

Thanks in advance
It would appear that most of the LPT's will drop about .5 of a cent as a result of tax changes.
Now I feel is when they should drop the DRP system and do a buy back.
KPF are already doing a buy back.
From here we will see a revaluation slowly upwards because of the inflation factor.
cheers BB

[777]

KIP are also doing a buy back.

[voltage]

i am sure all the negatives have been built into their price, do you think is it time to start buying again?

[Billy Boy]

i am sure all the negatives have been built into their price, do you think is it time to start buying again?
When to buy or sell is entirely up to you. :)
I personally feel the prices have been built in buy now. Having said that, be
aware of the likely hood of this double recession issue. It has been warned
about now for six months or more and appears to be happening.
Billy Smurff has not finished yet, and has said so. (Interest.co.nz one on one).
Residential Property, I think, will continue to slide in value. A land tax in this area (with conditions) ;)
seams likely. Property held for speculative reasons with get murdered once again.
Stand alone houses for rent will drop off and be replaced by Flatting Blocks
or Complexes because of bad tennants and the cost of land, etc. These buildings are
considered "Comercial" now. House Leasing could become the norm for those who can afford.
I am of the opinion that Commercial Property has been clobbered enough. Should
the gumment have another go then cost would be passed on as they are going
to be now,..... Not good!
Next sector in the LPT portfolio !!! " Flatting complexes":D
cheers BB:)

[Billy Boy]

Depreciation laws being revisited by Peter Dunn
This could have an interesting result(s)....
I had a chuckel at this one....
"if you Lease a building, the L/Lord cannot claim depreciation on the carpet,
Chairs, Drapes, Lifts, etc....
But
"if you lease a bus, the leasor can claim on the whole damb sh-bang"
cheers BB

[CJ]

"if you Lease a building, the L/Lord cannot claim depreciation on the carpet,Chairs, Drapes, Lifts, etc....All those will be appreciable under the proposed standard for commercial buildings. (to the extent they are owned by the landlord, it will normally be the tenant that owns the carpet, chairs, drapes so they will claim the depn).

These rules appear to be taxpayer friendly for commerical building owners after the recent spat of taxpayer unfriendly changes in relation to buildings.

[Billy Boy]

[QUOTE=CJ;315163] it will normally be the tenant that owns the carpet, chairs, drapes so they will claim the depn).

Not always I am told.....
and thats where there are some hiccups.
I wish I could find that bloody link 4u... maybe someone else can get it.
cheers BB

[CJ]

[QUOTE=CJ;315163] it will normally be the tenant that owns the carpet, chairs, drapes so they will claim the depn).

Not always I am told.....
and thats where there are some hiccups.According to this, no hiccups for commercial buildings:

http://taxpolicy.ird.govt.nz/news/2010-08-11-release-depreciation-issues-paper

[RRR]

As the OCR creep up, LPTs will be less and less attractive. All LPTs are leveraged and I assume their interest costs will only rise and thus reducing profits(and dividends). Recent tax changes will only add to the misery. I will be a cautious buyer and will add only if the price drops significantly from the current levels. I am surprised that the share prices are still holding up!!

[Omega]

As the OCR creep up, LPTs will be less and less attractive. All LPTs are leveraged and I assume their interest costs will only rise and thus reducing profits(and dividends). Recent tax changes will only add to the misery. I will be a cautious buyer and will add only if the price drops significantly from the current levels. I am surprised that the share prices are still holding up!!
LPT's have a significant portion of debt covered by swaps and therefore changes to the OCR have minimial impact on earnings. Yesterday's annoucement on fit-out depn is good news and they will still retain circa 60-65% of their total depn allowance from 1 April 2011. FY2011 yields are 8-11% TAX PAID - the depn and tax changes for FY2012 will drop the yields by 1% to 7-10% TAX PAID, which is a helluva lot better than many other sectors. And if you're game, borrowing 50% against your shares increases your yield by 50%!

[voltage]

most have dropped 30% this year, surely this must be the bottom, where to from here??

[RRR]

Good point Omega. The situation i am in is different to yours. You are using margin but i am using my home equity(revolving credit). Current interest rate is 6.25% and for me to invest in companies for dividends my dividend return has to be above 10%(they currently are but is going to come down) and i cant claim any money back. Hence OCR will affect my investing decisions. I will sit in the sidelines for now. Percy talked me out of using revolving credit.

Voltage-your guess is as good as mine. Good luck if you are investing.

[fungus pudding]

Good point Omega. The situation i am in is different to yours. You are using margin but i am using my home equity(revolving credit). Current interest rate is 6.25% and for me to invest in companies for dividends my dividend return has to be above 10%(they currently are but is going to come down) and i cant claim any money back.


:confused:What money do you want to claim back that you can't? :confused:

[Billy Boy]

Good point Omega. The situation i am in is different to yours. You are using margin but i am using my home equity(revolving credit). Current interest rate is 6.25% and for me to invest in companies for dividends my dividend return has to be above 10%(they currently are but is going to come down) and i cant claim any money back. Hence OCR will affect my investing decisions. I will sit in the sidelines for now. Percy talked me out of using revolving credit.

Voltage-your guess is as good as mine. Good luck if you are investing.

What the hell here old son ?? :confused:
If you have X amount of $$$ surplus then you would need to get max return.
Be that return from what ever source. bigger the return bigger the risk (a given).

If you go for a fixed interest investment, then "y" return less TAX. And you are locked in.
Most LPT's are around 8 - 9% clear in you mit. (no bloody tax)..... DYR
Dont need the divvy ???.... then go for the DRP... If you think very carefully... !
Then & if you are getting about 8%... what do/should you give a stuff about
the share price. ???... What would the Bank give you.. (less tax). Or any bonds etc.
I have a lotta money invested in lpt"s (spread).. they have served me very, very
well indeed through these turbulant times... and are still doing so. I cant find any
advantage in selling.
BB:)

[RRR]

I confused a lot of people and that was not my intention. Sorry guys!! I too have invested in LPTs(15%) of my portfolio and all the dividends are reinvested in DRPs and didn't opt for cash(I like DRPs esp with a discount). I am not selling my shares either and nor I am encouraging others to sell. A good choice for investors with no mortgage or debt, and lot of cash and expecting income. I wish I was one such investor.

BB-I don't invest in fixed interest investments(bonds, fixed deposits etc-why pay 33% tax). My salary goes to revolving credit home loan at 6.25%. For any other investments I make(dividend oriented), it has to yield close to or more than 10%(6.25% add 2% for the top tax bracket)- If not, I am better off paying my mortgage. If the LPT dividends are going to come down(which it will) and the share prices are stable or higher, it doesn't make sense to buy it in my situation. I would be buying LPTs 'only for dividends' and not for share price growth.

FP - If I bought LPTs on margin, I could claim the interest paid.

LPTs are good and I like it(not the managers though)

I am looking at investments from my point of view and in my specific situation. It may not make sense to other investors. Every one is different and they have different needs. I hope I have explained it better and will make no further attempt.

[voltage]

RRR there are a number of other NZ shares that pay good dividends, do you invest in these?? they may have better growth prospects. Would it be a better idea to leverage into LPTs instead of buying a rental investment which does not give a return around 8% net

[RRR]

Voltage - I do have other NZ share investments and it is easy to find out!!. I am a newbie and continuing to learn. I decided not to use margin after much thought. Margin lending rates are going to go up with OCR and the dividends from LPTs are going to come down(assuming no share price change) and hence I would be wary of using margin for LPTs. There is a thread on margin lending in the newbie section-suggested read.

[fungus pudding]

FP - If I bought LPTs on margin, I could claim the interest paid.

LPTs are good and I like it(not the managers though)



You van claim the interest on your revolving credit mtge also - just watch your timing so you can clearly show the purpose of using or raising your loan was tp purchase income producing shares. No problem there.
As far as managers go for LPTs., have a look at
dnz. which floated this week. (previously unlisted)
They've restructrured their horrible mngmnt system to internalise it, and might have a very healthy future.

[Billy Boy]

They've restructrured their horrible mngmnt system to internalise it, and might have a very healthy future.

I wish some of the other would look at this....

Fungus.... whats you take on NAP going from a LPT to a listed company.?
cheers BB

[fungus pudding]

I wish some of the other would look at this....

Fungus.... whats you take on NAP going from a LPT to a listed company.?
cheers BB

Sorry - haven't followed NAP - don't have any. I only hold ING, KIP, DNZ KPF and APT.

[Snow Leopard]

from todays announcement (http://stocknessmonster.com/news-item?S=ING&E=NZSE&N=198560)

ING Property Trust changes name to Argosy Property Trust

Today ING Property Trust Management Limited, the Manager of ING Property
Trust (the Trust), announced it is changing its name and therefore the
Trust's name to Argosy Property Trust from 1 October 2010.

The new name and brand for Argosy Property Trust follows the announcement
that ING New Zealand (INGNZ) is changing its name to OnePath, later this
year. The changes are the result of INGNZ becoming a wholly owned subsidiary
of ANZ National Bank Limited, part of the ANZ Group back in November 2009.
ING Property Trust has adopted a brand independent of INGNZ/OnePath.

Peter Mence, General Manager of the Manager, said "This is a positive step
for the business and gives us an exclusive identity that reflects our
specialist expertise in the property market. The Argosy name and brand is
perfectly aligned with the characteristics and objectives that have delivered
successful results for ING Property Trust."

The name Argosy is derived from a fleet of ships and reflects the strength
that comes from a quantum of individual ships operating together in a fleet.
The strength of the property trust comes from the diversified nature of the
Trust's portfolio, with 81 properties spread across a number of locations,
sectors and tenants.

Just like an argosy, the Trust remains robust, moving forward with strength,
to deliver a steady dividend yield, as well as the potential for capital
gains, for its unitholders.

ING Property Trust has a high-quality portfolio of moderate value properties,
which gives it the ability to remain agile and active in its property
acquisitions, tactical sales and active management style.

The various subsidiary companies and management entities associated with the
Trust will adopt the new name and brand. The management team and Board of
the Trust will remain unchanged.

Peter Mence said, "It is only the name and look of the Trust that is
changing. Our focus and commitment to servicing the needs of our unitholders
and tenants remains as strong as ever."
The new NZX ticker code will be ARG. This will be active on 1 October 2010.

feeling slightly sea-sick :t_down:
regards
Paper Tiger

[fungus pudding]

most have dropped 30% this year, surely this must be the bottom, where to from here??

Which one or ones have dropped 30% this year?

[RRR]

Thanks FP for your advice. DNZ is in my watch list and will decide if to invest in due course. GMT held AGM today. They didn't tell investors anything new, except that they are issuing more bonds to lessen the reliance on the big banks-good idea.

[Billy Boy]

Was interesting to note that they expect the div to drop only half a cent after the 2012 adjustments.

BB

[fungus pudding]

Was interesting to note that they expect the div to drop only half a cent after the 2012 adjustments.

BB

Is that in response to previous post? Who is 'they'? DNZ or GMT?

[Billy Boy]

Is that in response to previous post? Who is 'they'? DNZ or GMT?

Sorry in response was in their splurb
GMT

[upside_umop]

PWC building looks to be on a bit of a lean from my house....

[CJ]

PWC building looks to be on a bit of a lean from my house....Are you sure your not on a lean? ;)

They have said the building is fine and will reopen with the CBD I thought.

If it is on a lean, maybe it could become a tourist attraction like the tower in Pisa?

[upside_umop]

I live down Sherborne street (St Albans slums!) and on Saturday morning noticed it looked a little on an angle. Checked it again today...it definitely leans towards Forsyth Barr Building. Anyone else vouch for this?

Maybe I am leaning funny, as I notice KIP came out with an announcement saying its fine :scared: Maybe a lean is 'minor' structural damage?

[upside_umop]

Luckily there isn't too much exposure for the trusts down here...


Quake city facing decade-long rebuild (http://www.theaustralian.com.au/news/world/quake-city-facing-decade-long-rebuild/story-e6frg6so-1225915021009)

Check out this part....

More than 500 buildings in the inner city alone are believe to have substantial damage from the quake. One of the city's tallest buildings, the 14-storey Westpac building, is likely to be demolished after large cracks appeared in its supporting columns.

There was intense amount of energy...

Scientists believe the earthquake -- the worst in New Zealand since 1931 -- released the energy equivalent of 67 nuclear bombs of the size that devastated Hiroshima.



Ouch...I'm wondering what sort of effect this whole quake will have. One one side, you have damage to buildings presumably dropping their price and on the other you will have higher demand from places that can't re-establish back in their offices. Same goes for residential housing. The net effect?

[Lizard]

Ouch...I'm wondering what sort of effect this whole quake will have. One one side, you have damage to buildings presumably dropping their price and on the other you will have higher demand from places that can't re-establish back in their offices. Same goes for residential housing. The net effect?

Looking for possible silver lining, I am hoping that it at least improves the odds of NAP being able to lease the space coming due sometime soon in their Torrens House office block.

[upside_umop]

I would say it will have a silver lining for the Leasors with good, undamaged buildings, as there will be some marginal office space that just wont get the tick. The losers will be the Leasees given the potential price increases faced. I guess it will also depend on what the old council buildings are like, given 6 offices consolidated into 1. This latest round of events could help the CCC given they're one negative outlook with S&P (although a drop in the bucket I suspect in the scheme of things).

[whirly]

PWC building looks to be on a bit of a lean from my house....

Has anyone had a closer inspection yet?

[CJ]

Has anyone had a closer inspection yet?

It has been cleared by the engineers and staff who work in it have been told they can go in. If you know anyone who works there, ask them to do the 'golf ball test'.

[whirly]

Haha golf ball test! My house sank and broke in half during the Inangahua earthquake and being solid concrete has never been repaired we have a 6" fall in the kitchen which has caught a few out after a a couple of drinks. Some of the broken houses in Christchurch look pretty habitable put next to much of the accommodation here in Greymouth.

No disrespect meant to any who have lost their homes.

[RRR]

GMT DRP fully underwritten by Craigs.. Reason-capital management!! Very clever and cheeky. Announced few weeks after AGM!! I don't remember reading this in their report.

[Lawso]

A lot of volatility in the GMT sp this week. Up to 98, now down to 93. Why? Possibly related to going ex div this week. I can't think of any other reason. A bargain @ 93, I reckon.

[fungus pudding]

A lot of volatility in the GMT sp this week. Up to 98, now down to 93. Why? Possibly related to going ex div this week. I can't think of any other reason. A bargain @ 93, I reckon.

Aren't all LPTs other than PFI ?

[voltage]

fungus pudding; you are the guru on LPTs. I have started to add to portfolio. When I sell rentals any equity will go into these. Do yo see more downside or is this as bad as they get??

[fungus pudding]

fungus pudding; you are the guru on LPTs. I have started to add to portfolio. When I sell rentals any equity will go into these. Do yo see more downside or is this as bad as they get??

Nobody knows that unfortunately. I have a few and they certainly provide good income, particularly for a 33% tax payer. So they should rise rather than fall. But I'm not a guru on LPTs. Property is my game - not the share market which behaves very very differently. I bought in because of the huge % above buying another building. e.g. for 500k I have gained equivalent of 56000 income which I could not have obtained from a 500k building. Mind you I'm at the stage where I no longer borrow or want to borrow to gear up - been through all that - so it's horses for courses, and it's easy to pick up 50,000 worth at a time. . I don't sell things - so if they fall it just means some beneficiary down the line will be smiling a bit less :mellow: Not everybody is in that situation. But to repeat, I don't know anything about shares. I have never ever met a share investor - they all seem to be traders. To a commercial real estate investor 20 years is a short term investment. It's a long long time to a residential investor and seems unheard of in the NZ share market.

[Billy Boy]

ING making their move... very good news I feel.

ASSET: ING: ING Property Trust purchases freehold title at Albany
ING Property Trust Management Limited (the Manager), the manager of ING Property Trust (the Trust), today announced that the Trust has successfully acquired the freehold title for Albany E Block land. The freehold title for the 4.77 hectare block was purchased from Albany City Development Corporation with the purchase price currently confidential between the parties. The block currently comprises the Homemakers Centre development, anchored by Mitre 10 Mega, and 2.76 hectares of undeveloped land. "Both parties are happy with the outcome of the transaction and the acquisition of the freehold title is a very positive step for the Trust. With the Trust combining the freehold and leasehold interests we gain complete control of the site, removing all of the risk associated with leasehold exposure," said Peter Mence, General Manager of the Manager. Mr Mence also added that some earthworks have previously been undertaken on the undeveloped portion of land, in readiness for future building work when economic conditions are favourable. Settlement of the acquisition will be on 27 September 2010. ENDS

[RRR]

VHP raising capital for acquisition of Australian Hospitals and Health services-1 for 1 renounce able rights issue for $1.05. I will be taking part. What do the other posters think? Anyone own this little performer? One of the most boring stocks in my portfolio, but 32% up since the purchase in 2008(DRP has been good with this one).

[Lizard]

Hi RRR,

I think I bought around 80cps back when it was CHP (Calan Healthcare). I guess property trusts aren't that exciting - mostly just owned for the income and a bit of upside if timed right.

In some ways, it is good to see a property trust investing in more property at the cyclical lows, rather than the nasty habit they have of selling into the lows and buying the highs in order to manage distributions and debt covenants. However, the problem I have is that they are buying into Australian property - which is hardly at the same cyclical low and nor is the currency . On that simple basis, I'd question whether the investment has much to add longer term, other than to the (asset based) management fees.

Either way, I find it hard to get passionate about the property stocks - I tend to keep a few for a rainy day. I don't see much need to own more - so any investment in the cap raising will probably not be for the long term.

[johndeyell]

Westfield Group, the world's biggest owner of shopping malls, will create a new retail trust that will raise A$3.5 billion and own a half stake in its centres in Australia and New Zealand.

The group, chaired by high-profile businessman Frank Lowy, will seek a separate ASX listing for Westfield Retail Trust, which will gross assets of A$12.2 billion.

The new trust will own a stake in 54 malls, including 42 in Australia and 12 in New Zealand.

The transaction would start with capital distribution to its security holders of A$7.3 billion by way of units in the new trust.

Westfield retail would then raise up to A$3.5 billion offering new units, with A$1.75 billion underwritten by Citi, Credit Suisse and Morgan Stanley.

The public offer element is to be $2 billion and Westfield security holders will be offered units worth A$1.5 billion.

The new trust "responds directly to significant market demand for a domestic trust focused on investing in high quality retail real estate, with conservative gearing and income sourced primarily in Australian dollars," Lowy said in the statement. "

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The restructuring will reduce Westfield Group's net debt by A$4.4 billion and reduce its future capital needs, it said.

The retail trust will have its own board and management team while Westfield Group will act as responsible entity, property and development manager, without charging a fee, the statement said.

After the restructuring, combined per-security earnings in 2011 are forecast at between 92.9 Australian cents and 93.1 cents.

That would be made up of 74.6 cents per Westfield Group unit and between 18.3 cents and 18.5 cents for Westfield Retail.

The 54 shopping centres hold some 13,195 retail outlets across Australia and New Zealand.

They generated 550 million shopping visits and A$22 billion of retail sales, Westfield said.

Shares of Westfield Group were unchanged at A$12.81 on the ASX, having been halted earlier for the announcement. They have dropped 1.3% this year.

Westfield Group has 119 malls worldwide and some A$61 billion of assets.

Investors in Westfield Group will vote on the spinoff plan on Dec. 9.

[CJ]

The retail trust will have its own board and management team while Westfield Group will act as responsible entity, property and development manager, without charging a fee, the statement said..A property trust with no fee. Sounds like gold.

I wonder what yeild it will launch at.

[fungus pudding]

A property trust with no fee. Sounds like gold.

I wonder what yeild it will launch at.

Does using their own staff cost any less, or produce better results, than having an external manager? I supose it all depends on the mangement contract, but it's an interesting question.

[CJ]

Does using their own staff cost any less, or produce better results, than having an external manager? I suppose it all depends on the mangement contract, but it's an interesting question.To me it sounds like Westfeild Ltd will be taking on some responsibility and not charging for it. Even companies with an external manager would still have a board of directors.

It will also be interesting to see if the Trust can decline to do refurbs, new asset acquisitions, etc if they think it is not in there interest (but is in Westfeild Ltd interest).

[johndeyell]

I've been trying to download the info from www.westfieldretailoffer.com but there seems to be a broken link or something for the download, can anyone else access it?

[macduffy]

The key to this is of course the values at which the properties are transferred from Westfield to the new trust.

We musn't overlook the fact that the major driver of this is to reduce Westfield's debt.

[johndeyell]

The key to this is of course the values at which the properties are transferred from Westfield to the new trust.

We musn't overlook the fact that the major driver of this is to reduce Westfield's debt.

Well they would have to be sold at current market value. That's not necessarily a bad thing, the current market value of the properties is probably quite favourable for the trust to acquire them at.

[macduffy]

Well they would have to be sold at current market value. That's not necessarily a bad thing, the current market value of the properties is probably quite favourable for the trust to acquire them at.

Yes, but arriving at a current market value for such thinly traded properties leaves a fair bit riding on the valuer's opinion. Put up to tender/auction they might fetch quite different prices.

[RRR]

Thanks Lizard-Yes, Ozzie property market is expensive and the currency is high. But they will be earning rentals in Australian $ and well shielded from the recent depreciation tax laws in NZ-that is a positive I would have thought. Management fee will come down to 0.60%(from 0.75%)-of course we all know how these managers of LPT's operate and their conflict of interest with shareholders.

[JayPe]

Yes, but arriving at a current market value for such thinly traded properties leaves a fair bit riding on the valuer's opinion. Put up to tender/auction they might fetch quite different prices.

So they're creating an entity to have a half share in an entity that they will own the rest of? That sounds like dodgy Macquarie engineering to me. There have to be strings somewhere, and the asset value is probably a good place to look first.

[Lizard]

Thanks Lizard-Yes, Ozzie property market is expensive and the currency is high. But they will be earning rentals in Australian $ and well shielded from the recent depreciation tax laws in NZ-that is a positive I would have thought. Management fee will come down to 0.60%(from 0.75%)-of course we all know how these managers of LPT's operate and their conflict of interest with shareholders.

Hi RRR, Well I wish I'd given more thought to this VHP cap raising a bit earlier now - perhaps I would have sold a few earlier to raise cash to exercise (which always seems a safer bet to me than trying to sell the rights). Now I am stuck between living with unacceptably costly dilution or ploughing in a large sum of cash when I have better uses for it... and if the market price is anything to go by, I am not the only person who doesn't want to double their holding.

That being the case, it seems likely at current rights price that Forbarr (as underwriter) could end up with a large overhang that could circulate the market for some time to come. If I take up my rights, I will probably own more VHP than I'd like for at least another 9 months before they reach a value worth selling.

Also, reading through the rights documents, although yield looks good, WALT's are marvellous and cap rates used seem undemanding, my reading of the notes seem to suggest that the valuations were based on some additional capital expenditure scenarios being completed. While I think they have allowed enough cash for this, it does create another area for things to go wrong. I also wasn't too sure about the lessee rights of purchase - as I read it, Healthe may still take up their rights and therefore preclude VHP buying about $30m worth of properties out off the mix. Plus there is the issue of the $5m unsecured loan being acquired, which is made to sound so risky as to be a giveaway. Australian tax status confused me too.

Have to say, this was all just quick read stuff. Overall, the geographical diversification is a good thing and I quite like the idea of holding Aussie property under NZ PIE structure (especially after Chch earthquake showed the risk in holding pure NZ based property).

Any other thoughts on rights issue?

[devito]

All I can say is "what a pain in the arze".

I only have 2,500 of these so selling the rights will net me next to nothing after brokerage.

They are trading at 2 cents more than what I can pick them up at if I take up the rights. Not much of a discount now!

I think I will just let the rights expire.

The whole exercise has been to the detriment of the existing shareholders.

[RRR]

Hi Liz. I will be taking up my rights in full and apply for a bit more. VHP is my smallest holding, so I don't have to dig too deep into my pocket.
The biggest risk to me seems to be the tenant's option to purchase the properties, esp Health Care. They occupy 56% of the properties being purchased by value and all properties occupied by Health Care are valued under A$30 million.

Here is a statement from the prospectus about the "option".

"However, the Trust understands that Health Care is considering exercising its option in respect of properties with a value not greater than A$30 million".

[RenHoek]

Wow.... ING (ARG) sp is falling off a cliff face!
Bad results released today?
Div due just before chirstmas too....?

[RRR]

VHP 1:1 rights issue must be hard for large shareholders and that is the obvious reason for the share price weakness in my opinion. The share price fell after the record date for the rights issue and that tells the story. The share price should recover over time if the risks mentioned in the prospectus doesn't eventuate.

[RRR]

Interesting to see the downtrend of LPT share prices before the tax changes in 2011. The earnings will go down further(and the Dividends) in 2011-12 before it can go higher. Late 2011-early 2012 will be a good time to buy-that is my guess any way.

[_Michael]

Interesting to see the downtrend of LPT share prices before the tax changes in 2011. The earnings will go down further(and the Dividends) in 2011-12 before it can go higher. Late 2011-early 2012 will be a good time to buy-that is my guess any way.

Hi RRR and Lizard

I am looking at buying some of these although did not own prior to rights issue.

Things that attract me here are WALT 11.5 years and 90% inflation proof due to CPI indexed rentals.

Couple of questions though that you may be able to help with:

Is the 8.2 CPS projected divined tax free despsite being partly generated offshore?

Does anyone know how the rentals in the newly acquired properties compare to market rental on a $/sqm basis and

Why were Orchard selling out of these properties if they had such long inflation indexed leases in place?

Thanks and regards,

M

[RRR]

Hi Michael

1. Yes, the dividends will be tax free as long as they remain PIE entity (I am not sure whether the status is going to change)
2. I don't know - but the yield is decent anyway
3. The orchard fund which owns EHCT is a closed end fund and that is why they are selling-I had the same question in my mind and found the answer in orchard website.

[Lizard]

Hi Michael,

I am sorry but I did not get time to look closely enough at this one, so took the advice of my broker and let the rights lapse. Given the broker record, this probably makes them a buy (I don't think he reads ST...[:fingers-crossed]). I have not looked at the register either, so am not sure of the likely success rate on this cap raising - hoping I am not indicative, as no doubt this process has cost a bit!

I have located the web-site for Orchard (http://www.orchardfunds.com/Investors/Reports.aspx) and it may be worth a download and a read before the Essential Healthcare Trust disappears off the map. Also, the overall accounts may provide some clues as to why the sale... I need to find the time for a read, so will post back if I do!

[Lizard]

Looks to me like Orchard's desire to sell mainly results from excessive gearing in current market.

From latest Orchard quarterly update:


Essential HealthCare Trust sale process
Over the past quarter an exclusive due diligence period was granted to a party interested in acquiring all of the assets of the Essential HealthCare Trust (Trust) for cash consideration. With the Trust approaching the end of its fixed term, the decision to grant exclusivity reflects the desire of many of the Trust’s unit holders to receive a cash return at close to current NTA after transaction costs.

[Lizard]

And further to that, the notes to Essential Healthcare Trust Accounts:

Net Working Capital Deficiency
As at 30 June 2010, the Trust has a net working capital deficiency of $95.8 million.

Debt of $97.0 million owing to BOSI which is due to expire in March 2011. The Trust has the option to either refinance or wind up the fund. The Trust has commenced discussions with financiers regarding an extension of its existing debt faciity.

The directors believe the Trust could negotiate an extension of its debt facility but there remains a risk that it cannot be refinanced. Accordingly, the Directors of the Trust believe there is significant uncertainty on the going concern basis of preparation and that the Trust will continue to be able to pay its debts as and when they fall due.

Notwithstanding, the ENCT's financial statements have been prepared on a going concern basis and no adjustments have been made to the financial report relating to the recoverability and classification of the asset carrying amounts or the amounts and classification of liabilities that might be necessary should the Trust not continue as a going concern.

The directors have formed this view based on a number of factors including:

* stabilisation of capital market conditions and property yields,
* moderate gearing levels,
* all properties generating revenue, and
* current buyer interest in EHCT's assets.

Perhaps they could have done the deal for a little less?

[_Michael]

Thanks Liz and RRR

I also checked the Orchard website. Positive implications for purchase price that it was to some extent a forced sale.

I have an acquaintance at Orchard NZ so will also ask and post back if I find out anything interesting...

[Jaa]

Pretty poor takeup of the Vital rights issue - 71.5%

Forsyth Barr and sub-underwriters left with 41m shares.

[winner69]

Sheather in The Herald thinks managers lining their own pockets (selfish was a word he used) and the Vital deal is just a huge transfer of wealth from existing shareholders new institutional ones. Who were the underwriters eh?

If this is the case might be worth while buying a few Vital shares now ... even though I know nothing about them

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10701236

[POSSUM THE CAT]

Winner 69 I think you do used to be Callan healh properties or something like that then became ING Medical Properties.. I believe now tied up with ANZ after ING withdrawal from NZ. My own opinion is sit and wait maybe $1 will buy them wit a better understanding in 6 months time

[Snoopy]

Major CBD quake damage has affected PWC Tower still owned by KIP(?). Partial collapse of internal stairway system, even though building seems structurally OK. Building fixible, but what high powered professional will want to work there now? Worst case is that it may have to be written off for psychological rather than structural reasons.

SNOOPY

[Snoopy]

Were you in PW building.A trust I am involved in use Harmans,while I have used L.V North.Both 14th or 16th floors.I hope they do home visits as you will not get me in there.Are you OK.?

It was my broker who knew someone in the Price Slaughterhouse Coopers Tower Percy. I was at home having lunch at quake time.

SNOOPY

[percy]

It was my broker who knew someone in the Price Slaughterhouse Coopers Tower Percy. I was at home having lunch at quake time.

SNOOPY

Me too.!!! Glad you are OK.

[Snoopy]

Me too.!!! Glad you are OK.

Ironically Wellington could be more affected than Christchurch in the aftermath of this earthquake. Only a handful of high rises in ChCh. There are plenty of pre 1970 high rises there. Ensuring they are construction rated to even 50% of current earthquake standards will no longer cut it. Not a property trust investor myself, but I am wondering which listed entities have a large holding of Wellington office block stock?

SNOOPY

[Aaron]

Argosy and Vital health care are "internalising" their management.
They pay the current managers to get out of the contract and then they appoint new managers. How are the new managers paid?(percentage of the portfolio)
If the trusts aren't taking on their own staff and really slahing costs how is this beneficial. You may have a better management contract in the future but you've paid $32.5mil to end the old contract.
I am only asking as I am have not done my own research and wonder if there is an easy explaination.

[macduffy]

The benefit to unitholders lies in ending the previous conflict of interest whereby management, normally remunerated according to the size of the fund regardless of performance, had an incentive to grow the assets, often by borrowing, whether or not this was in the best interests of unitholders.

For this reason I sold out of APT and KIP many years ago and havn't regretted doing so.

[CJ]

How are the new managers paid?(percentage of the portfolio)New managers are employees so are on salary and bonus.

They shouldn't have the same incentive to buy a building just to increase the assets under management.

[Billy Boy]

DNZ/ARG Merger !!!!
sound good to me. Share price likes it also
BB

[fungus pudding]

DNZ/ARG Merger !!!!
sound good to me. Share price likes it also
BB

How likely is that? DNZ keen, but Argosy not apparantely.

[Billy Boy]

It's going to be interesting indeed....
My gut feeling is that DNZ want the backing the ARG have etc....
and Mr (whats his face from DNZ) likes this international management sceme,
I think ARG answered very well
BB

[fungus pudding]

It's going to be interesting indeed....
My gut feeling is that DNZ want the backing the ARG have etc....
and Mr (whats his face from DNZ) likes this international management sceme,
I think ARG answered very well
BB

Mr Whatsit is probably Paul Duffy. Don't know about his taste for international stuff, but he's a good operator. I hold 150,000 shares in each and would be happy to see them merge.

[Billy Boy]

Mr Whatsit is probably Paul Duffy. Don't know about his taste for international stuff, but he's a good operator. I hold 150,000 shares in each and would be happy to see them merge.
Paul Duffy.... thats his name. I agree a good operator.
not so long when DNZ bought out his contract and then re-employed him.
Should the two merge, then ajoined they would have to be the best LPT on the NZX.
GMT rising on big volumes today also.!!
ARG/DNZ/GMT all merged :ohmy:!!!! ..... just wondering;)
BB:)
Dis... 2 ,, in my ARG holding
1 , in my DNZ holding

[fungus pudding]

Paul Duffy.... thats his name. I agree a good operator.
not so long when DNZ bought out his contract and then re-employed him.
Should the two merge, then ajoined they would have to be the best LPT on the NZX.
GMT rising on big volumes today also.!!
ARG/DNZ/GMT all merged :ohmy:!!!! ..... just wondering;)
BB:)
Dis... 2 ,, in my ARG holding
1 , in my DNZ holding

Would be great - got a few GMT but never been too keen on them - lot of undeveloped land, or did have last time I looked. But I'll believe any amalgamation when I see it. :D

[RRR]

Good news indeed and much needed for LPT investors. I wish I could insert happy faces - how do you do that? I think I disabled that function in my computer.
VHP had a strong run too with much help from a strong Aussie dollar.

[fungus pudding]

Good news indeed and much needed for LPT investors. I wish I could insert happy faces - how do you do that? I think I disabled that function in my computer.
VHP had a strong run too with much help from a strong Aussie dollar.

LPT advice is free. Computer advice - very expensive. Insert credit card in CD drive slot, and read on. :D

Ready? Here goes. Select 'go advanced' then you get a vaiety of wonderful smilies .:t_up:

[RRR]

:t_up:

Thanks FP

[fungus pudding]

:t_up:

Thanks FP

No problem. :p Most grateful for the bundle of notes that fell out of my CD drawer. ;)

[Lizard]

I thought the result out of KPF puts them back into a more respectable position. At 64cps, they're at about an 18% discount to NTA and yield 6.2%. Have bought a few for the income portfolio and am hoping they can improve leasing and distributions further this year.

[Billy Boy]

I thought the result out of KPF puts them back into a more respectable position. At 64cps, they're at about an 18% discount to NTA and yield 6.2%. Have bought a few for the income portfolio and am hoping they can improve leasing and distributions further this year.
KPF will be one watch I feel. I sold @63 cents as I thought the lift is only the pre div rise.
Might be buying back in soon. They still have quite a bit of vacant space, but as I understand
it, AK office space is comming back into demand, Slowly .
Npt got a bit of knock with their revaluation return, Mainly due the chch quake. Eastgate etc.
But one to keep a 'orb' on.
BB

[Billy Boy]

ARG Volumes ??? mostly "off market" 3,443,704 by 1600 hrs
Whats happening that we dont know about ???
I was going to do some "profit taking"
Not now !!
BB

[Billy Boy]

Those of you who have been asking me???
buy Arg.... if you must buy anything.
DNZ... imo... over valued at 133...
6-7% on divy payout !!!... you judge.
I would like this merger to go ahead, but ARG are in the driving seat.
If there is no advantage to ARG holders, then why should they. !!
DNZ management, I think are sweeting a bit. Can they maintain
8 cents divvy P/Share ?? ... You Judge !!
Thank you for your emails ... but no more please
BB:)

[POSSUM THE CAT]

BIlly Boy this cat will vote against any merger between ARG & DNZ I think it would be suicidal for ARG

[Billy Boy]

BIlly Boy this cat will vote against any merger between ARG & DNZ I think it would be suicidal for ARG
Yep but... surely the meat is in the detail....
as I said... only if their is an advantage to AR$G holders. !!
DNZ want this more than ARG (holders)

[RRR]

Agree with PTC and BB

There is no gain for ARG holders if the merger takes place.

[Billy Boy]

RRR.... It's very hard to number crunch at this stage
That is , until we get ARG's full year results (due soon).
Even then there will have to be some questions out side of the box.
BB

[The Great Gold Guru]

Hi Fungus Pudding. Could you check your private messages ASAP .... Cheers !!

[The Great Gold Guru]

HI Possum the Cat. Could you check your private messages ASAP. Cheers !!

[The Great Gold Guru]

Hi, Could any ARG shareholders please email me at sdb2011@live.com regarding the upcoming AGM. Regards The GGG

[Beagle]

ARG - Quite a drop in divvy payment proposed - i.e. to at least 6 cents a share if the management internalisation proceeds.

What are they trying to suggest if the proposal doesn't proceed ? Are they trying to excercise undue influence on shareholders through some sort of thinly vieled threat that the dividends would be something lower if the management internalisation doesn't proceed ? What does the payment of that $32m odd do to the gearing level, its going into the high 40% range from what I can see. How is this possibly in the best interests of shareholders ?

The cost to proceed with the internalisation looks grossly excessive to me and I don't like the way they framed up that reference to the future reduced dividend. Gearing is also quite high. There's doesn't seem to be a lot to like with ARG and I'm really pleased I sold out recently at 85 cents.

[Billy Boy]

I am in favour of this meeting. Lay out the facts !!! Argosy unit holders do
not need to buy out the managers ( who are basicialy the ANZ Bank) Onepath for $30 odd million,
when they can be voted out FOR NOTHING at the AGM!!. (or FA)
Whats wrong with Argosy Directors ??? Need looking at do they ?? Communications not good enough,
I am infavour of "in house" managers.
Not necessarly a merger with DNZ. (Yet).
Argosy Holders need to be FULLY INFORMED and active on this one.

DNZ and Argosy Unitholders Request Special Meeting 24/06/2011
DNZ Property Fund and institutional Argosy Unit Holders have signed a meeting requisition requesting a Special Meeting of Argosy investors to vote on resolutions to ensure transparent consideration of options for Argosy’s future.


Argosy Unit Holders DNZ Property Fund Limited, Accident Compensation Corporation, Westpac Banking Corporation & BT Private Selection (a Unit Trust Managed by BT Funds Management (NZ) Limited, Superlife Trustees Nominees Limited and Albany Power Centre Limited have today sent a notice requesting a meeting of Unit Holders of Argosy Property Trust to be held as early as July 15 but no later than August 1 2011, ahead of the Argosy AGM.
“The six resolutions to be considered at the Special Meeting ensure that Argosy unitholders are given the opportunity to hear details about any and all alternatives that are available and ensure a truly independent review of those alternatives.” says DNZ Property Fund Chairman, Tim Storey.
The level of support gained by DNZ means the Special Meeting should be held ahead of Argosy’s scheduled AGM in August and according to DNZ Chairman Tim Storey reflects the level of discomfort among significant institutional Argosy unitholders with the process adopted by Argosy’s independent directors.
“It’s a level of disquiet DNZ shares given the apparent offhand consideration so far given to alternatives including our merger proposal,” said Mr Storey.
“Our view is that Argosy unitholders should have the alternatives put before them before addressing the Internalisation Proposal so we’re pushing for a mid July Special Meeting to consider these resolutions.”
Mr Storey stressed that the support for calling the Special Meeting did not necessarily mean those institutional investors in Argosy backed the merger proposal.
“What they do support is at least having the information presented to all Argosy unitholders to allow them to make a considered decision on the merits of the proposals.
“DNZ’s view is that the benefits available to Argosy unitholders may be more material under other alternatives and should be properly evaluated - but that is a matter to be considered after the Special Meeting.
Mr Storey said that as an Argosy unitholder DNZ also believed there was potential conflict of interests between the Directors and the owners of the manager in pursuing only the internalisation proposal.
“We believe the best interests of unitholders are served by knowing the detail of all alternatives that can be put in front of Argosy’s unitholders.”
Mr Storey said the six resolutions to be considered at the Special Meeting would ensure transparency and a fair consideration of all alternatives available to Argosy Unit Holders.
The resolutions call for the appointment of independent advisors, due consideration of any and all alternatives available to Argosy and full disclosure around the current proposal to internalise the management contract.
A copy of the notice requesting the special meeting accompanies this announcement and contains the following six resolutions:
Resolution 1 Amendment to the Trust Deed
Resolution 2 Evaluation of the Alternatives to the Argosy Internalisation Proposal
Resolution 3 Directions to the Trustee
Resolution 4 Directions to the Trustee
Resolution 5 Manager to refrain from calling a Unit Holder meeting to consider Argosy Internalisation Proposal without first engaging in relation to alternative Proposals
Resolution 6 Release full details in of exclusivity arrangements with OnePath (NZ) Limited and voting arrangements with any Unit Holders
Important Notice: If at any future point the DNZ merger is able to be progressed, Argosy unitholders would be provided with a Simplified Disclosure Prospectus. This would be part of the information provided to unitholders prior to seeking the approvals for any merger proposal. At this time no DNZ shares are available for subscription by any Argosy unitholders and, for the avoidance of doubt, at this time no money is currently being sought and no applications for DNZ shares will be accepted or money received.
ENDS

BB :mad ;::mad ;:

[Billy Boy]

Thank you Bryan

To the Unit Holders
Argosy Property Trust Dear Unit Holder Argosy Property Trust We are writing to you in our capacity as Trustee (the "Trustee") of the Argosy Property Trust which is managed by Argosy Property Management Limited (the "Manager"). You may be aware from comment in the media, that the Manager has announced its intention to pursue a proposal whereby the management contract in relation to Argosy Property Trust would be internalised, and that, if agreement on the proposal is reached, the Manager intends to seek approval of the unit holders for the proposal at the annual meeting in August 2011. The independent directors of the Manager have recently announced they will not recommend the initially proposed purchase price. We understand that the internalisation proposal continues to be under negotiation. The Trustee's primary role in relation to the internalisation proposal, if agreement is reached, will be to ensure that unit holders have the opportunity to make an informed decision as to whether to approve the proposal. The Trustee agrees that the internalisation proposal would need to be put to a meeting of unit holders for their approval by way of an extraordinary resolution (requiring a 75% majority) directing the Trustee to enter into the required documentation. The procedure to put an extraordinary resolution to unit holders is outlined in the Trust Deed and the Unit Trusts Act 1960. We have had a number of discussions with the Manager outlining the process that is required to be followed, including the need for an independent report on the proposal to assist unit holders in their decision making process. When the Notice of Meeting has been prepared, the Trustee will include a letter with the material to be posted to unit holders and that letter will outline the importance of unit holders seeking independent professional advice if they are unclear as to what the proposal means to them personally. We anticipate that our letter will also draw appropriate sections from the independent report to the attention of the unit holders if it is considered that that will help in making their decision. To assist consideration of the proposal, the independent directors of the Manager have appointed Grant Samuel to provide the independent report assessing the proposal and the proposed price. We have been involved in reviewing and approving the terms of reference for that report to ensure it covers matters relevant to unit holders. The report is currently in the process of being prepared. You may also be aware through the media that DNZ Property Fund Limited ("DNZ") has had a number of discussions with the independent directors of the Manager in respect of a proposal that Argosy Property Trust merges with DNZ. At this stage, the independent directors of the Manager have elected not to progress the DNZ proposal. Despite that, as part of the consideration of the internalisation proposal of the management contract, it will be important for unit holders to understand the alternatives. To this end, Grant Samuel in their independent report will assess any alternatives to the proposed internalisation transaction including the DNZ's proposal as it is currently known. In addition: - On 8 June 2011, a number of institutional investors gave notice requiring the Manager to call a meeting of unit holders to consider a number of ordinary resolutions (requiring a simple majority) which would make certain requests to the Trustee, including to consider removing the Manager on the grounds that it is in the best interest of unit holders for the Manager to cease to hold office as manager of the Trust. It is important for unit holders to note that such an ordinary resolution would not bind the Trustee to remove the Manager. The Trustee would however, consider carefully any such resolution providing the view of the unit holders. The Manager had advised the Trustee that its present intention was to have this first set of resolutions considered at the annual meeting. - On 24 June 2011, DNZ together with some of those and other institutional investors, gave notice requiring the Manager to call a meeting of unit holders to consider a number of further resolutions variously being extraordinary or special resolutions (or if not passed as such, as ordinary resolutions), which would give directions and/or requests to the Manager and to the Trustee, including to negotiate alternative proposals to the internalisation proposal. Potentially, extraordinary resolutions would be binding on the Manager and Trustee. The Manager had not at the date of this letter advised when a meeting to consider this second set of resolutions would be considered. At this stage it is too early to state what the Trustee's response to the proposed resolutions would be. There are a number of factors that need to be carefully considered and we expect to be in a position to provide an indication as to what action we would take if the resolutions were passed when the meeting papers for the resolutions are posted to unit holders. It is important to note that the proposals as outlined in this letter and as outlined through the media, may change. In our opinion, unit holders should wait for further information from the Manager and from the Trustee, as well as the Notice(s) of Meeting including the resolutions to be considered before forming any conclusions in respect of the proposal or the other matters referred to in the media or this letter. Yours faithfully Bryan Connor

[fungus pudding]

Do we have any experts on PFI? I don't hold any shares in this outfit, but have a few in most of the others. Specifcally I am curious as to why they sell above NTA, when none of the other LPTs do. Looks like they've got fairly good properties. Most grateful for any comments.

[troyvdh]

No expert here but have held for yonks
Solid dull predictable.....about 50 + buildings all Ind....some redeve does occur......mostly in Auckland..some in ChCH....Placemakers/windflow...Bleiheim rd...debt appears always less than 30 %....1/4 divs never lower than in the past...usually higher/same...shares in lieu of cash give 2,5 % discount.......Peter masfen holds $3m plus (and takes the shares-not cash)....Mr G Morgan was a director for years...management appear never to change...management contract recently changed to ?????.
Fees I think are performance related ?????
Share price has gone up to about 155.....in recent times down to $1....in mid to late teens or a while now....
for me its like money in the bank (which I have never had in my life) but it pays more.....besides I quite like looking at Ind Buidlings...annual reports are simple and very informative...
hope this helps

[fungus pudding]

No expert here but have held for yonks
Solid dull predictable.....about 50 + buildings all Ind....some redeve does occur......mostly in Auckland..some in ChCH....Placemakers/windflow...Bleiheim rd...debt appears always less than 30 %....1/4 divs never lower than in the past...usually higher/same...shares in lieu of cash give 2,5 % discount.......Peter masfen holds $3m plus (and takes the shares-not cash)....Mr G Morgan was a director for years...management appear never to change...management contract recently changed to ?????.
Fees I think are performance related ?????
Share price has gone up to about 155.....in recent times down to $1....in mid to late teens or a while now....
for me its like money in the bank (which I have never had in my life) but it pays more.....besides I quite like looking at Ind Buidlings...annual reports are simple and very informative...
hope this helps

Thanks for your comments. Sounds pretty much like most of the other LPTs, so I'll probably buy some. Still curious as to why they sell above assett backing, when most are about on par or like KPF - well below.

[troyvdh]

..."you pay for what you get".......perhaps...if you are over 50 you will know what i mean....

...this is embarrasing....I have just finished night shift however....I think it should read.....

...."you get what you pay for"......off to bed now...

[fungus pudding]

..."you pay for what you get".......perhaps...if you are over 50 you will know what i mean....

Yeah - well over (thanks for reminding me)! You do get what you pay for, but somehow it seems to me that either these are overpriced, or all the others are underpriced, going by NTA, debt levels, walts etc. Think I'll jump in anyway. Sorry about that as one thing is for sure - the minute I buy - they'll drop. Time has proven that prediction infallible.

[POSSUM THE CAT]

Fungus Pudding these have not been as good since the change of management. Profit well down

[fungus pudding]

Fungus Pudding these have not been as good since the change of management. Profit well down

Yea I see they've sold a couple of buildings which never really helps a prop. company.

[troyvdh]

Possum... can you state "not being as good since the change of management" as being correct.....have we not had a "wee global glitch"..........

they have maintained divs....blah blah......

...no offence intended but ....does not the Labour party sort of say the same thing.....cheers...

[percy]

With Peter Mafsen and Humphrey Rolleston having big shareholdings you can bet your boots PFI will do well.

[POSSUM THE CAT]

TROYVDH I am just using there reported figures profit well down for quarter

[troyvdh]

Possum with all due respect....the world in recent times has experienced a global financial crises....me thinks that perhaps you need to read more...the world is....a little bigger than...a couple of Islands in the deep south...we are all connected....cheers,,,

[fungus pudding]

With Peter Mafsen and Humphrey Rolleston having big shareholdings you can bet your boots PFI will do well.

https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=3014438

[Billy Boy]

KPF seams to be hitting the airwaves right now. No doubt is all about management etc.
I have had four investors ring me concerned about the management/structure changes.
These folk are concerned that The/"A" major holder is pulling a swifty. I dont know.!
I sold my complete holding about twelve months ago and have not got back in, so have
not kept up with developments.
Anyone got a handle on the situation.
Thanks in advance
BB

[Aaron]

KPF seams to be hitting the airwaves right now. No doubt is all about management etc.
I have had four investors ring me concerned about the management/structure changes.
These folk are concerned that The/"A" major holder is pulling a swifty. I dont know.!
I sold my complete holding about twelve months ago and have not got back in, so have
not kept up with developments.
Anyone got a handle on the situation.
Thanks in advance
BB

That NZSA sent me an email and they are of the view that the proposal may favour mgmt and Augusta (one and the same) so will vote against it.
This is the sort of thing joining NZSA is good for. Personally I would hardly get through an internalisation proposal but now I have the opinion of someone(s) who have read and considered it all. Although in this case I don't hold any shares.

[Billy Boy]

Tks Aaron
Yes as I suspected, 7mil was the buyout figure. seams most of the Lpts are becomming Coy's and this could change the pecking order quite a bit over the next 2 - 3 years.
Am watching ARG to see where they go now they have switched.
cheers
BB

[Aaron]

Just skimming through AMP Office interim report and should really find the annuals for last year but Operating cashflow has halved compared to six months to 31/12/2010. Some buildings were sold but not half the portfolio. I probably need to go back and see what % the govt represents as tenants but the new super ministries might be looking to cut lease costs.
Does anyone have a view as to the future of property trusts/companys. I still have a pessimistic outlook for the future for everything.
What yield would you expect to get. It used to be 8%-10% but a forecast payout of 5.04cps with 91cent share price is only 5.5%. A bit of downside price risk if interest rates were to start going up. Although I don't see that happening any time soon.(although gearing is only 22% of asset value so maybe not significant). lack of depreciation claims also hits in the 2012 financial year.
No real reason for writing this as I am just perusing the interim report, maybe subconciously hoping to send the prices down so I can buy more at a better yield.

[fungus pudding]

Remember these are PIES and quoted return is free from further tax. So to a 33% tax payer that's as good as around an 8.5% return.

[Billy Boy]

I dont like AMP coz they are all Office. Just a personel thing.
So dont study them.
LPT's are (in my view) still one of the best Divvy Investments available,
paying a good (PIE) percentage return on investment. They will have
that hedge against "real" inflation when it starts.(and it will !!).
Further, they are relativley easy the get out of quickly if things go to
custard. As against bonds etc..
Marlin; MLN, (wrong thread , I know) is an interesting one. lines up with LPT's
Fundmentals look sound, pays a good divvy every quarter, and is a PIE.
Cheers BB

[Halebop]

Just skimming through AMP Office interim report and should really find the annuals for last year but Operating cashflow has halved compared to six months to 31/12/2010. Some buildings were sold but not half the portfolio...

Lower rental receipts, higher property expenses (much to do with incentives and leasing expenses reflecting the current economics of property leasing), much higher management fees (nifty trick on lower rents and net disposals) and a higher tax bill despite all of the above (due to the removal of depreciation allowances).

Given low gearing (lost financial engineering benefits on the downside, lower risk on the upside), soft leasing markets, limited company structure (Net vs Gross) and an external manager, I think the forecast is what investors can expect. In the current environment maybe that yield looks ok for some? This isn't a category I'm particularly interested in but the external management fee doesn't appear to add value.

[Stylerz]

With the latest ARG dividend i seem to have received all cash instead of still being in the DRP?

Does anyone know where i can get the form to opt back in?

Not sure if this has had something to do with the recent change from Property Trust to Property Limited.

[777]

http://www.argosy.co.nz/InvestorCentre/DividendReinvestmentPlan.aspx


As always deal through the share registry responsible.

[karen1]

Interesting article in the NBR today, food for thought:

http://www.nbr.co.nz/article/wellingtonians-flee-earthquake-prone-office-buildings-115979

[Billy Boy]

The last comment hits the nail I feel.
There has been a lot of warm fuzzy's comming from the
Real Estate foke as of late. (understandable I spoze), Just that
these fuzzy's dont seam to eventuate.
BB

[Billy Boy]

Good on you GMT.
I have been lobbying a number of company's lately as to
publishing their F/y & Half/y reports in CSV format & PDF.
Not the splurb but the financials( in CSV), so we can down load
into Spreed sheets etc.. Cant do it with PDF.
I have recently cancelled my electronic reporting coz all I can do with
PDF is read it. So now I get the Book so I can scan into excel format,
(PDF Dos'ent scan very well) and from there do my annalisis.
This of course this defeats the $$$ purpose of electronic reporting. Those
books must be costly.
Today I received an E-mail from Jonathan of GMT with an attached CSV
version of their last report and he is trying to do what I have asked for the future.
Good on you Jonathan.... a real PR man. They are hard to find these days.
One of the excuses I have received :- "to hard to do" . ??? What...!!, Bull****.
Govt Dept's do it all the time. And they'er not that bright !!
So come on you's others, if you want to save money. Make electronic usage,
Useable.
Cheers to all
BB

[Stylerz]

Hi all,

Over last 7 years i have accumulated reasonable holdings in ARG, GMT and KIP. Using the DRP schemes to reinvest half of the dividends and using the other half for an income stream.

Am now looking to add another one or two of the listed property trusts into my portfolio.

Any suggestions on which trust/s i could add to compliment my portfolio.

Main criteria i'm after is consistent quarterly dividend, and a DRP scheme.

[POSSUM THE CAT]

Stylerz ANO & PFI also you could have improved your lot IMHO buy voting in a sharetrader member onto the board of ARG they bought out the management contract from ANZ & kept all the same management staff at I believe the same salaries. In My opinion they have done no better. What a waste of 13.5 million if my memory serves me right. I would like to see a big change of Management.

[troyvdh]

...PFI....goggle Peter Masfen....cheers....

[RRR]

I think you have enough diversification in LPT's already (if one can call it diversification). VHP (hospital properties with exposure to Australia) is a bit different, I think, but expensive! PFI would be my other choice, simply because of the management track record.

[fungus pudding]

Hi all,

Over last 7 years i have accumulated reasonable holdings in ARG, GMT and KIP. Using the DRP schemes to reinvest half of the dividends and using the other half for an income stream.

Am now looking to add another one or two of the listed property trusts into my portfolio.

Any suggestions on which trust/s i could add to compliment my portfolio.

Main criteria i'm after is consistent quarterly dividend, and a DRP scheme.


Have a look at DNZ.

[Billy Boy]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10830901
I agree with this Tyson guy, the board have reached their useby date.
ARG used to be my biggest holding, Not now. Others are so much better.
BB

[POSSUM THE CAT]

Billy Boy one of the sharetrader members was standing for the board But in the notice of meeting the existing board members showed their dislike of him.

[Billy Boy]

Are you talking about this forum ( sharetrader) or some other ??

[POSSUM THE CAT]

Billy Boy YES this sharetrader Steve Blakeley but it is up to him to tell you what non de plume he posts on read the ARG notice of meeting.

[JMKC]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10830901
I agree with this Tyson guy, the board have reached their useby date.
ARG used to be my biggest holding, Not now. Others are so much better.
BB

I also agree with him...although it's fair to say that if on one hand you are asking the coy to reduce gearing and at the same time saying they should increase the cash div it's a touch contradictory.

[POSSUM THE CAT]

JMKC they also kept the same management Team on the same salaries after spending over 13million buying out the management contract
.

[Billy Boy]

Billy Boy YES this sharetrader Steve Blakeley but it is up to him to tell you what non de plume he posts on read the ARG notice of meeting.

Tks Possum
Now it all fits together,
Cheers for that
BB

[Billy Boy]

I also agree with him...although it's fair to say that if on one hand you are asking the coy to reduce gearing and at the same time saying they should increase the cash div it's a touch contradictory.
Agreed
And that's why I sold out ( seven fig holding ),

Arg will not increase their div for about another 18 months. IMO

They have slipped down the peaking order somewhat.
BB

[Snoopy]

Over last 7 years i have accumulated reasonable holdings in ARG, GMT and KIP. Using the DRP schemes to reinvest half of the dividends and using the other half for an income stream.

Am now looking to add another one or two of the listed property trusts into my portfolio.

Any suggestions on which trust/s i could add to compliment my portfolio.

Main criteria i'm after is consistent quarterly dividend, and a DRP scheme.

No really a property mutt myself, but was intrigued at Woolworths spinning out their supermarkets in Oz and NZ into a separate venture called SCA property group, as announced on 5th October. Any thoughts from the property gurus as to whether this might be a good thing?

SNOOPY

[macduffy]

Not a property guru but I couldn't get enthusiastic about this. Makes sense from WOW's point of view though - in fact it's surprising that they havn't done it earlier. No doubt they will take appropriate leases with multiple optional renewals, to give them maximum flexibility as to whether they stay or go in future years. Investors will probably focus on the steady income and locations and not worry too much about the fact that the properties are fairly "purpose specific" and may not be so valuable for other uses.

As an aside, about 30 years ago I was involved with the management of a pension fund that decided to diversify into property - as was the fashion at the time. We developed a supermarket for Woolworths NZ's previous owners which performed very satisfactorily for a decade or so until a subsequent management of the fund decided to sell it. From memory, it generated the best return of the 8 or 9 properties in the portfolio. But that was then.

[Snoopy]

Not a property guru but I couldn't get enthusiastic about this. Makes sense from WOW's point of view though - in fact it's surprising that they haven't done it earlier. No doubt they will take appropriate leases with multiple optional renewals, to give them maximum flexibility as to whether they stay or go in future years. Investors will probably focus on the steady income and locations and not worry too much about the fact that the properties are fairly "purpose specific" and may not be so valuable for other uses.


Have read the SCA prospectus for WOW shareholders. WOW do not normally hold property but were forced to develop their own during the GFC. All they are doing here is unwinding that position.

I got frightened by the term 'stapled security'. But all it means in this instance is that the shareholders own both the property owning company and the property management company which has to be good. Projected earnings yield of 7.9% to 9.4% (based on book build price) sounds good. Although I guess we kiwis won't be able to take advantage of the franking credits. I haven't been able to figure out whether those projected 7.9% to 9.4% rates include franking credits or not. Average lease length is 15.8 years, which sounds really good. Five yearly rent reviews for the anchor WOW tenants.

The valuers have valued the properties as though they will be sold off in ten years time. Rent agreements mean this unlikely IMO. There is superficially a lot to like here. Then again I am not a property mutt. So what am I missing?

SNOOPY

[troyvdh]

At the risk of being accused of ramping....just having just read that PFI has returned 8.78 % pa since listing......to me that sounds fairly commendable.....how does that compare to the more "sexy property " companies....KIP et al....
....personally ...on reflection...and hindsite is a wonderful thing....me thinks that I would have put heaps more of my investments funds in PFI.....no wonder Masfen has/is still there...
Hold PFI ...a little less know than what i used to..,.

Re Pike....have many mixed thoughts ...mainly of the dismayed/disgusted type...held $40k......trully a sad day....

[RRR]

GMT acquiring the rest of Highbrook park and I got their booklet today. I will be taking part in the capital raising. GMT do seem to look after minority shareholders well.

[Snow Leopard]

GMT acquiring the rest of Highbrook park and I got their booklet today.
Yeah. Half a kilo of paper in your mailbox: even when your signed up for electronic communications !

best wishes
Paper Tiger

[777]

The market didn't like PCT announcement. Still 3 years to run on the lease and the same amount of time to get another tenant.

Topping up time.

[Aaron]

GMT acquiring the rest of Highbrook park and I got their booklet today. I will be taking part in the capital raising. GMT do seem to look after minority shareholders well. I can't say I have read the proposal or that I would understand it even if I did, Hopefully it is all about location, location, location. In an economically gloomy environment further development will only take tenants from somewhere else. ARG's five year summary in their annual report makes interesting reading. net property income dropping over five years, total assets dropping, debt increasing, securities on issue increasing and NTA and dividend decreasing. yet share price is up over 33%. Maybe this is a reflection of the 2008/2009 crash making things too cheap. Dividend yields in property trusts are around 6%(more depending on your maginal tax rate) compared to 4% for a term deposit. If interest rates go up(not likley) these property trusts will be looking overvalued. I don't understand the world credit markets but if the "shadow banking" that I read about in the paper goes bad, banks might need to up interest rates to attract depositers bad news for the property sector. Better not overthink it, I will buy the GMT units on offer but I can't help thinking that the property sector isn't hugely great value at the moment.

[fungus pudding]

GMT acquiring the rest of Highbrook park and I got their booklet today. I will be taking part in the capital raising. GMT do seem to look after minority shareholders well.

In what way?

[Aaron]

FP you have had considerable experience with investment property. How would you value listed trusts/companies. I would expect a lower yield from them as they require little management other than voting, tenant and property risk is diversified due to their size. What sort of yield would you expect from an investment like this compared to direct investment. The capitalisation rates from the annual reports are somewhere between 7%-8%.

[fungus pudding]

FP you have had considerable experience with investment property. How would you value listed trusts/companies. I would expect a lower yield from them as they require little management other than voting, tenant and property risk is diversified due to their size. What sort of yield would you expect from an investment like this compared to direct investment. The capitalisation rates from the annual reports are somewhere between 7%-8%.

Yeah - I agree with your comments re low managment, spread of risk etc, but I'm not so sure yield is lower. Depends whether you include capital +/- in yield. Some do - some don't, because capital gain is not a cetainty at all. For me cap. gaindoesn't matter much although my beneficiaries might think differently. :eek2: I've got a reasonable pile of LPTs and I get an in-hand annual return of 5.5 to 6% which is equivalent to 8.5% plus, which is fine. Capital growth hasn't been too flash, but it's damned easy money and without the risk of losing a tenant, which can be a walloping % of an individual's portfolio. Anything for an easy life for me these days. I just wondered why you think GMT looks after shareholders well? I have KIP, ARG, GMT, PCT,DNZ, PFI and Aug. GMT seems to be trailing most of the others, with Aug down the bottom. Mind you, I've got awfuly slack and don't read reports etc. although I do turn up at the odd AGM if in my home town, and it looks like a decent spread is likely. :t_up: Anyway I can't find a quality building to match the immediate return, and I've had my day with junk (the PIE status makes the difference to a max. margin tax payer) so although with gearing an individually owned property should certainly do better, but those days are gone for me. My income is fine and I see no point in taking more to the grave, so it's really horses for course. The other point I should add is I know absolutely nothing about the share market. I have only invested in direct real estate apart from a tiny dabble in BLT once which was a very satisfactory fun thing. So the LPTs were just something the same but different. Many experts have told me I'm daft, but my accountant doesn't think so anymore. I hope that answers your question.

P.S. That's the return on current value of shares - it's around 1.5% higher on purchase price

[macduffy]

Re the WOW property spinoff. This from another site.
QUOTE

No great reason to hang on to Woolies property spin-off SCA Property by: John Durie from: The Australian November 22, 2012

THE best advice for Woolworths shareholders is to sell the retailer's property spin-off as soon as possible while the stock market is still infatuated with yield .

Today's annual meeting is expected to approve the creation of SCA Property comprised of some $1.4 billion worth of shopping centres the company hasn't been able to sell directly .

It is a smart play for Woolies CFO Tom Pocket because he is transferring value from the property trust to the headstock .

The only trouble is that, at least initially, both will have the same shareholders given SCA is being distributed in specie to Woolies investors

The first warning flag comes from the fact that the Woolies supermarkets will be housed in an entity with the new, unrelated name of SCA, which invites suspicion that Woolies does not wish the new company to be too closely associated with its creator.

Also, the deal is a related-party transaction between a $36 billion company and a $1billion-plus company and normally on those numbers the smaller one loses

Then there are highly restrictive lease terms including no rental increase for five years, which means while the property company is paying okay yields on day one the outlook isn't so flash.

There might be good reasons to hold the stock but they are not readily apparent.

[Snoopy]

Re the WOW property spinoff. This from another site.
QUOTE

No great reason to hang on to Woolies property spin-off SCA Property by: John Durie from: The Australian November 22, 2012

THE best advice for Woolworths shareholders is to sell the retailer's property spin-off as soon as possible while the stock market is still infatuated with yield .

Today's annual meeting is expected to approve the creation of SCA Property comprised of some $1.4 billion worth of shopping centres the company hasn't been able to sell directly .

It is a smart play for Woolies CFO Tom Pocket because he is transferring value from the property trust to the headstock .

The only trouble is that, at least initially, both will have the same shareholders given SCA is being distributed in specie to Woolies investors

The first warning flag comes from the fact that the Woolies supermarkets will be housed in an entity with the new, unrelated name of SCA, which invites suspicion that Woolies does not wish the new company to be too closely associated with its creator.

Also, the deal is a related-party transaction between a $36 billion company and a $1billion-plus company and normally on those numbers the smaller one loses

Then there are highly restrictive lease terms including no rental increase for five years, which means while the property company is paying okay yields on day one the outlook isn't so flash.

There might be good reasons to hold the stock but they are not readily apparent.

Thanks Macduffy. I received a note in the mail today informing me that those shareholders who do not hold a marketable parcel of SCP will have their shares aggregated and sold over what looks like a 6 week to 2 month period, unless you inform the registry with a request otherwise. I think I will allow them to do this with my own very small holding. I don't pay brokerage. And I get out at a time when interest rates are generally low, even if some claim they will go lower still in Australia. Still, I do believe in leaving some investment potential there for the would be buyer.

With the PIE tax advantages of most of the NZ property investments, I think you have to have a very good argument why you would not invest your property money in NZ, before you send your property capital off overseas!

SNOOPY

[troyvdh]

Not much discussion here....however both KIP PFI are currently quite strong.....have a wee peak at the buy/sell que.....cheers troy

[777]

DNZ as well. All ex dividend prices as well. I have done very well over the last couple of years on these. I think the continuing weak interest rates are helping things along.

[Blendy]

Slightly off topic, but hopefully I'm not breaking any rules here.

I've organised a public breakfast session with Peter Mence (Argosy CEO) on Thursday April 11, as part of the AUT Business Breakfast Club series. You are most welcome to come along and hear what he has to say, and have the opportunity to ask him questions - maybe some that have been discussed in this thread. Tickets are $20 (or $10 for students), and includes continental and cooked breakfast. :) http://www.thebreakfastclub.org.nz/ It is being held in the fancy new Sir Paul Reeves building at AUT.

[POSSUM THE CAT]

Blendy If you get The Great Gold Guru a poster from this site to come & oppose him it would be a very interesting Breakfast. But him on his own you would have to pay me to attend. I think you can understand as a shareholder what I think of Him.

[fungus pudding]

Anyone been following the merger of PFI and the unlisted Direct property fund? Any thoughts?

[777]

Can't see any downside to it and the market likes it. Up 4.9%.

[fungus pudding]

Can't see any downside to it and the market likes it. Up 4.9%.

Yes, but I'm not sure that tells us enough, given PFI already seems highly priced for a property company, relative to its NTA.

[fungus pudding]

Argosy seems to have been some good uplift in the property trusts over the last six months. up 14% over that period.

Do investors here have any preferences on the best LPTs right now, and how would you assess ownership versus actual commercial property (freehold), compared to syndicated (which I dislike but some like it) and other options.

Steer clear of syndicated. Some of the SPI ones have lost every cent invested. One of the Bayleys ones hasn't paid a cent out for years, and has called up extra funds from investors. They are almost impossible to exit. If there is a particularly good property involved you might be tempted, but be aware, you might be there forever. I have a few LPTs, around the value of building for a change from buying another building. I'm not interested in shares normally - real estate is my living. Not sure which are best of listed, but DNZ strikes me as having great manager in Paul Duffy. Compared to owning a building outright they have great benefits- spread of risk, most maintain occupancy in high 90% range. Impossible when you might own 2,3,4, buildings yourself. Remember they are all PIES. No need to keep records or even tell your accountant you own them, no paperwork at all unless trading, which I never do -I just keep things. So for pure income I like them. I have been a professional commercial landlord for years and when my other half retires we will spend far more time overseas travelling around. I intend to sell another building and double my LPT holdings to 2 mill.. Don't overlook the quoted returns are tax paid, so when you see say 6% that is a return of 9% to a 33% taxpayer. So no lawyers, accountants, etc to pay it's a pretty easy income. 2 mill will give me over 90k tax paid which is a nice top-up to my rental income. So I reckon once established they are a great add-on to chuck spare cash into. Capital gain hasn't been great - but that can be offset with vacancies when owning outright. And don't go by leases when looking for possible vacancies - I've had more than my share of bankruptcies among tenants, including one delightful experience of discovering a receiver had changed the locks on a building in CH-ch and it took me months to even get in. I think PFI looks interesting with the proposed merger. Some great buildings and excellent tenants, but high priced compared to NTA. They're all a it pricey at present (all over NTA) I'm not sure why they should ever exceed NTA, but they do. So for those who simply like to build reliable income they are ideal.

[Lizard]

NPT produced a good result yesterday - largely as a result of settlements in respect of earthquake damage, along with portfolio value increase from quality leasing activity. So NAV took a leap to 71cps (from 54cps), dragging up the s.p. to 68cps.

There is virtually no leverage here once the receivables from settlement come in. However, the property portfolio will need boosting to get income back up, so the proof of the pudding will be in the size of future dividends - reduced for now and dependent on the quality of re-investment.

[Sideshow Bob]

Any particular reason why a lot of the LPT have dropped back today? KIP down 4.6%, PCT down 5%, VHP down 3c, GMT down 2.5c.

Market was bad, but just seemed overall this sector was down a bit and wondered if I'd missed something. Is divvie time, but none of these went ex div today and GMT & VHP go ex-div around 11th/12th.

[fungus pudding]

Any particular reason why a lot of the LPT have dropped back today? KIP down 4.6%, PCT down 5%, VHP down 3c, GMT down 2.5c.

Market was bad, but just seemed overall this sector was down a bit and wondered if I'd missed something. Is divvie time, but none of these went ex div today and GMT & VHP go ex-div around 11th/12th.

Record date for PCT was 29th May. Haven't looked at others.

[Aaron]

Maybe an investor is picking a turning point for interest rates. If they rise enough suddenly the property company's yield isn't so great.

Also if interest rate/yield expectations increase then I guess discount rates for valuing the property increase as well, lowering the value of the property and increasing the market price over the NTA as STC mentions above.

Maybe the internet is making real inroads into the need for brick and mortar. The last GPT review I read mentions the threat of the internet. Who would have thought snail mail would become redundant so soon and that music shops would disappear with book shops possibly to follow.

[Billy Boy]

Maybe an investor is picking a turning point for interest rates. If they rise enough suddenly the property company's yield isn't so great.
I dont think so.
As the SP goes down the divvy % goes up. They are still amongst
the best yielders on the market.
If the Resv Bank starts lifting interest rates then we could see some
LPT departure's (for a while), until rent neg. begin to reel in values .
Good buying to come maybe.
I hold heaps of these things and over the last 10 yrs I have been quite
happy with the yield. (much better than the Banks or bonds). They saw
me through the GFC.
As my friend says "I never lost a cent in the 87 crash, coz I never sold
a share."
BB