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Autumn 2018 2018 NEWSLETTER ________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________ Our focus for 2018 is on improving our systems and processes in a number of key areas including financial reporting, health & safety and communications. We are now in the process of meeting directors and updating them on our proposals for change. • To enable us to provide you with the required information in time to meet the deadline for filing returns with the IRD by July 7 2018, please contact Kate Mackersy by the end of April, confirming that you intend to file your own personal return this year. Email: kmackersy@mitchellmackersy.co.nz or phone: 03 450 9540. • Investors who have an accountant/tax agent filing their returns on their behalf do not need to contact us. Mitchell Mackersy and MHP are working together to ensure investors’ expectations are met. We also take pride in maintaining the reputation Ron has developed over the past decades. We love hearing from our investors, so please contact either Omea Willows (owillows@mitchellmackersy.co.nz) or Kate Mackersy with any feedback or comments. ________________________________________________________________________________________________________________________ ______________________________________________________________________________________________________________________ For more information on MHP’s health and safety programme, please contact Anita Brosnan, MHP Project & Compliance Manager: email abrosnan@mhpl.co.nz. Over the course of his long career Ron has seen the law change from profession to business enterprise. However, he says there’s still no substitute for hard work and playing a ‘long game’ based on a win/win approach to all dealings. As well as being highly regarded as an astute legal and business professional and an expert commercial negotiator, Ron is also known as a quiet philanthropist. He is extremely generous with his time and actively supports many community organisations and charities. He is also known for spending time one-on-one with many of his employees and business contacts, providing advice and guidance. He takes a genuine personal interest in the career development of his team members, which is reflected in the strong, longstanding and loyal team he has helped build in the Mitchell Mackersy practice. Never one to shy away from a challenge, Ron is always willing to roll up his sleeves and face problems head-on, in situations where others may find themselves outside their comfort zone. He also has an innate ability to quickly pinpoint solutions to problems before others even reach the first step. This quality is closely related to his ability to identify the best people for the job and connect them with others, facilitating working relationships that result in long term mutual benefit. Ron cites the success of the property syndication and management businesses as a great source of pride, given that their success was achieved with the support of his family, friends, local business partners and a dynamic team of staff. Being featured on the cover of the NZ Law Society’s magazine LawTalk in 2014 was another career highlight. Asked what the ‘glue’ is, Ron says it’s family, staff, clients and collegial support. This philosophy is reflected in Ron’s strong and longstanding associations with many clients who he has known since the early days. He has also become a trusted advisor to his loyal client base, as well as to a great number of his staff and personal contacts – a position he will continue to hold over the next five years as a consultant to Mitchell Mackersy. ______________________________________________________________________________________________________________________ MHP is a leading New Zealand manager of syndicated and individually-owned commercial properties. We work to ensure the prime, high-performing assets we manage generate superior returns over time. Our dynamic team has extensive experience in commercial property and we pride ourselves on our bespoke, expert service. CHRISTCHURCH: QUEENSTOWN: DUNEDIN: ________________________________________________________________________________________________________________________ Mitchell Mackersy has successfully syndicated over 100 commercial buildings throughout New Zealand over the past 30 years, with a total value of over NZ$1 billion. With strong industry relationships, a highly skilled team and a loyal private investor database, we offer commercial property investments using a tried and tested model. QUEENSTOWN: ________________________________________________________________________________________________________________________ Copyright © 2018 Maori Hill Property, All rights reserved ________________________________________________________________________________________________________________________ September 2017 Newsletter – Welcome Welcome to MHP’s Q3 newsletter. We’re sure all our readers will be happy to see the arrival of spring, which has been a long time coming. The big issue of course is the election and as we prepare this newsletter the outcome of last weekend’s vote is still unknown. We are watching developments with interest as the major parties get down to business with Winston. Whatever the outcome, let’s hope the new government is formed swiftly. We hope you enjoy this newsletter – please contact us if you have any comments. We also invite you to follow us on LinkedIn for all our latest news and updates. Happy reading, the MHP team. Comments from Ron Mackersy As we head in to the fourth quarter of 2017, uncertainty still characterises the markets. The election is over, but the outcome is still to be determined. Globally, the effect of Trump is still a hot topic and hurricanes, weather bombs and earthquakes have caused major damage worldwide. Where does the New Zealand property market sit? Sales numbers are down but we are yet to see sustained price falls or the loosening of commercial yields. Hot spot Queenstown still bucks the overall trends. The airport numbers defy belief (over 1.8 million passengers in the year ended June 2017), infrastructure is struggling and land prices and development costs are at all time highs. The banks now seem to have more available funds in the commercial area. Competition between banks should hold or soften margins. We have also seen an increase in overseas interest in buying commercial property as overseas yields are still very low and New Zealand is seen as a stable alternative. Let’s hope our political situation gets resolved quickly as this could provide a review of how the world sees us. New Zealand was going so well – how things change! News from Dale Robertson’s desk Since our last update in June, we have continued to grow the MHP team to meet the demands of business growth. In Christchurch we have recruited Gabrielle Wethey to look after human resources and we are in the process of bringing a new property manager on board in Queenstown. As is usual for this time of year we are planning for 2018 and beyond. This includes business growth forecasting and making sure that our people, systems and processes are robust enough to cope with ongoing growth. We are also working with Mitchell Mackersy Lawyers on a communications plan intended to keep directors, shareholders and tenants better informed. Along with Mitchell Mackersy we are also analysing the results of our recent shareholder survey and looking at how we can improve our systems and processes to address the issues raised. Thank you to all shareholders who filled out the survey – your feedback was very insightful. New joiners to management portfolio This quarter we are pleased to have added two significant new properties to our management portfolio, detailed below. Both are owned by groups of investors represented by Mitchell Mackersy Lawyers. We have also seen growth in our private management portfolio, with the addition of an office building in Middleton, Christchurch and a retail and office complex in Dunedin. Countdown, 24 Medway St, Gore Leased to Countdown, this 2260m2 building was originally constructed in 1983, extended in 1994 and modernised in 2009. Its seismic strength is significantly in excess of minimum standards at 129% of NBS. The supermarket occupies a prime 5800m2 site with excellent access and parking. 31 Deveron St and 101 Don St, Invercargill Business advisors and chartered accountants Malloch McClean occupy this modern, purpose built two-level office building in the Invercargill CBD. Calder Stewart constructed the 1408m2 building in 2012 for the tenant, who requested a high quality build and fit out. The property includes 24 car parks. Health and safety update The regulations around working with asbestos changed on April 4 2016. The Health and Safety at Work (Asbestos) Regulations 2016 state that every building built prior to 2000 must be assumed to contain asbestos, and that no-one can go near it unless they comply with the regulations. PCBUs (people conducting a business or undertaking) with control or influence over a workplace have until April 2018 to develop a plan to manage the risk of exposure. The regulations are consistent with the Act’s intention that there is a collective responsibility to manage risks to health and safety. As the duty to indicate the location and presence of asbestos applies to a wide range of PCBUs and activities, we will be reviewing our management portfolio to identify those buildings built prior to 2000 to ensure compliance. For more information, please contact Anita Brosnan, Project & Compliance Manager, email abrosnan@mhpl.co.nz. Guest column from Crombie Lockwood We are delighted to have been appointed to provide insurance broking and advisory services to MHP across its entire property management portfolio. For those readers who don’t know us, Crombie Lockwood is the largest insurance broker in New Zealand, with around 750 professionals across 26 offices. Our Christchurch office, which is overseeing our work for MHP, has around 100 staff including a dedicated claims team. Internationally we have global reach through our parent company, NYSE-listed Gallagher. The current property insurance market in New Zealand is best described as “destabilised and uncertain” with premium and deductible increases being imposed. Unsurprisingly this is principally due to last year’s Kaikoura and Wellington earthquake along with a losing hand of floods, fire (Port Hills) and tropical tempests. New Zealand insurers are particularly impacted as they don’t have the geographic spread of risk or premium volume to offset the claims. In short, the industry’s entire premium income is many times less than the cost of claims. This is creating an unsettled market. In this environment, our role as MHP’s insurance broking and risk advisor is to insulate the property portfolio from these influences. We will be providing further market updates in future issues of this newsletter, so watch this space. Guest column from ANZ While the impacts on the economy of the election are still unknown, we did note some interesting currency movements in the lead-up to the election. The graph below shows the currency drop sharply (first yellow line) following the first poll with Labour’s new leadership and growing popularity. The second yellow line shows the sharp rise (almost 1 cent across the board) after a later poll showing an increase in National’s popularity. We all know the polls are what they are, but the impacts on the NZ dollar are very interesting.
On the interest rate front, bank funding pressures have eased somewhat but not disappeared. The gap between household lending and deposit growth has narrowed, which would suggest less competition for attracting domestic deposits. However, with the external borrowing constraints persisting (more scrutiny from regulators and credit rating agencies), lending growth is unlikely to increase unless deposit growth keeps pace. With the latter being somewhat of a restraint, tighter lending conditions are likely to remain for some time. This is likely to provide some stability around interest rates and credit margins at current levels, however the lag effect means a number of borrowers may face margin increases as facilities renew or extend to get to current levels. Team member profile Sonia Adams-Richardson Sonia joined MHP’s Christchurch office in March 2017 as Property and Facilities Manager, looking after MHP’s management portfolio in Show Place Business Park, Addington, Christchurch. She is also Property Manager for Cardinal Logistics’ new facility at Waterloo Business Park, Christchurch; and the Countdown supermarket in Gore. Sonia is of Brazilian-German descent and has lived in Christchurch since late 1990s, apart from a recent five-year stint in Auckland. Her recent roles include working as a body corporate manager and commercial and industrial property manager in Auckland. Sonia holds a Bachelor of Property degree from Auckland University. |
MHP/MM Newsletter – Autumn 2018 – April 2018
April 22, 2018
