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Australian Financial Review : October 17th 2006
FBA 052 ELECTRIC RAIL IPSWICH CBD 12.26 Ha SITE indicative boundary only Residential Development Site FOR SALE Brisbane's Western Growth Corridor • Land Area 12.26Ha • Existing 3 street frontage • Easy walk to electric rail -- Ipswich and Brisbane • Close proximity to local schools and golf course • Less than 5 minutes drive to Brassall Retail Shopping precinct • Recent commitment from Qld Govt to major infrastructure improvements in the Western Corridor Jeff Dolan 07 3370 1726 0412 433 377 firstname.lastname@example.org Pat George 07 3370 1719 0412 721 448 email@example.com Featured on www.colliers.com.au/69419 For Sale by Tender closing 4pm Wednesday 22nd November 2006 Our Knowledge is your Property www.colliers.com/australia Spectacular Waterfront Retail Investments FOR SALE Waterfront City, Docklands Featured on www.colliers.com.au/67304 • 4 Outstanding Retail Investments • Leased to established operators • Excellent city views & public transport access • Turnover rent provision • Huge Depreciation Bene ts • All restaurants overlook Victoria Harbour Tenant Lease Term James Squire 5+5years FIX 10+5+5years Kobe Jones 10+5years Beach Club 10+5years Pat Burke 0412 554 886 03 9612 8805 firstname.lastname@example.org Mark Wizel 0411 694 756 03 9612 8823 email@example.com U70289 The Australian Financial Review Tuesday 17 October 2006 www.afr.com 52 PROPERTY German lender arrives with Babcock purchase Ben Wilmot One of Europe's largest property lenders, Hypo Real Estate Group, has become the latest German institution to strike a deal with an Australian group. But Hypo's first major play with an Australian institution has a twist. Unlike other German institutions such as Deka Immobilien Investment in Sydney, which have been among the largest sellers of commercial property, or buyers such as SachsenFonds GmbH in Melbourne and Adelaide, it has bought a stake in another bank. Hypo said it had acquired a stake of about 2.2 per cent in the Australian investment bank Babcock & Brown. The acquisition was the basis on which to extend the pair's long-standing relationship, it said. ''The Hypo Real Estate Group has identified opportunities of expanding the joint business base in international real estate financing and public finance, particularly in markets in which the group has so far not had a strong market position,'' the group said. It identified Australia, Singapore and the west coast of the United States as areas where its relationship with the bank could drive its finance business. Babcock & Brown is driving its global real estate business hard. Last month it flagged plans with the GPT Group for a $2.1 billion investment vehicle focused on European retail property. As part of the proposed deal, the bank has contracted to buy 260 mainly supermarket-based shopping centres across Germany and Switzerland from a European family for about A1 billion ($1.7 billion). Hypo, formerly known as HVB Real Estate Capital, floated in late 2003. It was a spin-off from Munich-based bank HVB. Its model involved taking capital from the low-cost areas, such as Germany, and distributing it around the world, analysts said. Hypo's way of doing business has been described as cash flow- oriented and transaction-focused, and there are no fixed allocations to industries, sites or locations. At an investor day earlier this month, Hypo's management gave a surprisingly positive statement on the new business in commercial real estate financing in the future, analysts said. Its lending goal of A22 billion should be reached in 2006 and the company expects further growth in the coming years, giving rise to additional portfolio volume of A4 billion to A5 billion per year. Skill quest for John Holland Welders rank among the most sought after construction workers. Photo: ROBERT ROUGH Mark Phillips KEY POINTS The biggest labour shortages are in Western Australia and Queensland. Demand is highest for boiler- makers, welders and riggers. Guest workers are being hired. A shortage of tradesmen is looming as the biggest constraint on growth of one of Australia's largest con- struction businesses, John Holland Group. Group managing director David Stewart said yesterday the diversi- fied civil engineering and construc- tion group was thinking long and hard before committing to work because of uncertainty about labour supply. But apart from workforce prob- lems, the immediate future is look- ing rosy for the Leighton Group subsidiary, with about $3.3 billion of work in hand. The company is forecasting $2.2 billion in revenue this financial year after lifting turnover by 20 per cent to $2.1 billion in fiscal 2006. It lifted pretax profits by 56 per cent to $82 million. Profit before tax and investment-related write-downs more than doubled to $131 million. Mr Stewart, who replaced Bill Wild as group managing director earlier this year, said John Holland had an aspirational revenue target of $2.6 billion in 2008. ''The market is very buoyant so it's a great time for construction companies,'' he said. ''We have got activities going on everywhere. I have never seen it as buoyant as it is now. ''One of our biggest challenges is to make sure we don't lose the focus on the detail and allow ourselves to drift off this enormously active market.'' But Mr Stewart said the biggest issue confronting John Holland was a shortage of tradesmen, particu- larly in Western Australia, the Sunshine Coast and south-east Queensland. This is not a problem restricted to John Holland but one affecting all major builders. The group general manager of human resources and organisation strategy, Stephen Sasse, said the labour shortages were greatest for boilermakers and welders, followed by riggers and the finishing trades, including plasterers, painters and tilers. John Holland has managed to partly overcome the shortfall through productivity gains and by using special temporary worker visas. It has brought about 50 workers here from the Philippines, South Africa and South Korea. But the skills crunch was causing delays in starting projects, Mr Sasse and Mr Stewart told a briefing in Melbourne. ''That [workforce shortages] is something we're tuned into con- stantly just to make sure we don't commit ourselves to a project or to a client when we can't deliver,'' Mr Stewart said. ''There's nothing worse than a B-team or a C-team delivering a project that really needs A-plus.'' The NSW/ACT region was the largest source of revenue for the company in 2006, providing 20 per cent of turnover, followed by the southern region and the specialist tunnelling and underground mining business. Among the company's major achievements in the past year have been progress on the EastLink joint venture with Thiess in Melbourne, which is generating $100 million in turnover each month; Melbourne Airport's runway extension to cater for A380 jets; the Lane Cove tunnel in Sydney; and the Southbank Education and Training Precinct redevelopment in Brisbane.