[CAN] 20-22 Currie St | 123m | 31lvls | Office

[Düsseldorfer]

It's November and coming towards the end of the year. I don't think we are going to hear anything until at least the first quarter of 2009.

this building is supposed to be finished in 2010, that means it has to start in the first half of next year. i remember hearing that it would take 18 months to build...

[muzzamo]

I don't understand, I thought we are meant to be in a "mining boom"? So where are all the companies that need office space?? Rann should try (as he has tried with BHP, not sure how much success) and direct some head office's back to SA if they are going to be mining in our state.

We are in the early stages of a mining boom... They are still digging the hole!

We just have to be patient for the next 5-10 years...

Remember mining only accounts for less than 7% of our GDP, most of it is in retail and FIRE (Finance, Insurance and Real Estate). A lot of that "mining boom" stuff was coming from real estate agents etc trying to justify our 20% increase in property prices in 2007.

[AG]

It's November and coming towards the end of the year. I don't think we are going to hear anything until at least the first quarter of 2009.

this building is supposed to be finished in 2010, that means it has to start in the first half of next year. i remember hearing that it would take 18 months to build...

Take into account that the building hasn't secured any tenants yet, nor has it managed to secure construction financing as far as I am aware.

[Ben]

This development was granted a 12 month extension on 22nd of September 2008.

[frank1]

This development was granted a 12 month extension on 22nd of September 2008.

Is that good or bad news?

[Will]

This development was granted a 12 month extension on 22nd of September 2008.

Is that good or bad news?

It is good news considering the current economic climate. The developers could ahve easily walked away. This decision means that the project is still alive. All it needs is a tenant willing to pre-comit to almost 50 000sqm2!

[joshzxzx]

The only problem with this being that RENT for this signature building would prob demand very high rent. When you think about the current economic conditions most businesses are spending less...

Wasn't there talk of a Gov dept going in there???? Even that would not work as the gov is in deficit...

Things aint looking good guys..

[rev]

The only problem with this being that RENT for this signature building would prob demand very high rent. When you think about the current economic conditions most businesses are spending less...

Wasn't there talk of a Gov dept going in there???? Even that would not work as the gov is in deficit...

Things aint looking good guys..

I think it's more concerning that they still haven't found a major tenant(or any at all major or minor??), nor apparently any financing for construction, never mind what rent may be.

[bm7500]

Um.. guys.. how do we know that they haven't secured a major tenant yet?

Just because someone one here doesnt know or hasn't posted anything doesnt mean that things arent progressing in the background!!!

So how about we stop speculating and wait for some hard facts??

[loud]

Um.. guys.. how do we know that they haven't secured a major tenant yet?

Just because someone one here doesnt know or hasn't posted anything doesnt mean that things arent progressing in the background!!!

So how about we stop speculating and wait for some hard facts??

This is a hard fact - there is buckleys chance of this development happening under current economic conditions. Even if they can get 100% commitment from a tenant, obtaining finance is near on impossible.

As I have posted elsewhere, seriously loaded investors are having trouble obtaining finance for the purchase of existing, fully tenanted buildings. If they can't get it, how is anyone going to get it for a significant development with the potential for blow outs in cost etc?

[bm7500]

Um.. guys.. how do we know that they haven't secured a major tenant yet?

Just because someone one here doesnt know or hasn't posted anything doesnt mean that things arent progressing in the background!!!

So how about we stop speculating and wait for some hard facts??

This is a hard fact - there is buckleys chance of this development happening under current economic conditions. Even if they can get 100% commitment from a tenant, obtaining finance is near on impossible.

As I have posted elsewhere, seriously loaded investors are having trouble obtaining finance for the purchase of existing, fully tenanted buildings. If they can't get it, how is anyone going to get it for a significant development with the potential for blow outs in cost etc?

Thats just more speculation!

You dont know what the situation is for this particular development at all. You are pretty much suggesting that financial institutions arent doing big loans anymore and therefore this is just another develpment that 'probably' wont get loan approval...

I can tell you for a fact that if financial instsitutions dont write loans, they die! All thats happening now is that the banks etc are taking a lot harder look at the risk involved in all higher value applications that are submitted. Im getting a bit sick of people automatically suggesting in various threads on here that because of the GFC, various developments wont go ahead :wank:

If you know something concrete that is good bad or otherwise then post it in the thread, otherwise people need to stop filling up pages and pages and pages in these threads with unsubstantiated speculation.

End of Rant

[loud]

WARNING: Rant in progress

1) Read the news, financial instituations are dying!

2) My father worked in big dollar corporate lending for a major global financial provider, during the last recession he was actually instructed to stop lending. It does happen!

3) Banks are still writing loans, but are naturally less keen to write big ones, and rightfully so. What do I mean? see below.

What would you prefer if you were a bank? lending $100m to one group to build one building or lending $100m to 200 groups to build houses, buy investment properties, start up business, rack up credit card debt, buy a car, etc? Naturally a bank is going to want to lend to the 200 groups, it is a much more diversified, less risky investment of their resources.

4) ONCE AGAIN...I am aware of the sale of several significant properties that have fallen through due to finance. Purchasers are attempting to buy buildings with no development risk, 100% occupancy, strong rental growth, etc. They show this all to the banks and the banks can't give them the money.

I am drawing to the logical conclusion that if you cant get financial approval for the purchase of a sure thing, you aren't going to get approval for a risky development.

5) In the case of this particular development, what I do know is that an individual with a bit of money and foresight has managed to purchase a number of adjoining properties and has put a development application to council and council have approved it. This is where things seem to have stopped... No public pre-leasing campaign, no agents being asked to try and source tenants, no sign of tenants winding up business, no sign of much at all...

This is speculation, but I personally don't think the current owner/developer has the capacity on their own to carry out this development. I think that if it weren't for this credit crisis, the owner would have looked to sell the property with DA in place, or tried to find a like minded JV partner to fund and manage the development.

[Benski81]

WARNING: Rant in progress

1) Read the news, financial instituations are dying!

2) My father worked in big dollar corporate lending for a major global financial provider, during the last recession he was actually instructed to stop lending. It does happen!

3) Banks are still writing loans, but are naturally less keen to write big ones, and rightfully so. What do I mean? see below.

I can't agree with that either, because financial institutions aren't "dying" as you so melodramitcally put it. The poorly run ones that have made bad decisions are going under yes. Good and so they should why would we want poorly run insitutions creating the problems they have now. The obvious question that should be asked then is what happens to their market share? Either existing players in the market will take up their market share, making them more profitable, or new entrants will seek to enter the market place in order to make a profit.

As for your comment about the last recession, the context has to be understood. It was the period of time after deruglation and banks had no idea how to lend money and as a result they made huge losses to stupid loans that fell through. But that's the whole point, they've learned a lot from it and now lending is a sophisticated and well organised core business function of the financial institutions so there is no need to but a blanket ban on lending any more. That's not going to happen again, rather they alter their lending criteria or look more stringently at who then lend to but they certainly don't just "not lend". Let's be real here.

[bm7500]

WARNING: Rant in progress

1) Read the news, financial instituations are dying!

2) My father worked in big dollar corporate lending for a major global financial provider, during the last recession he was actually instructed to stop lending. It does happen!

3) Banks are still writing loans, but are naturally less keen to write big ones, and rightfully so. What do I mean? see below.

What would you prefer if you were a bank? lending $100m to one group to build one building or lending $100m to 200 groups to build houses, buy investment properties, start up business, rack up credit card debt, buy a car, etc? Naturally a bank is going to want to lend to the 200 groups, it is a much more diversified, less risky investment of their resources.

4) ONCE AGAIN...I am aware of the sale of several significant properties that have fallen through due to finance. Purchasers are attempting to buy buildings with no development risk, 100% occupancy, strong rental growth, etc. They show this all to the banks and the banks can't give them the money.

I am drawing to the logical conclusion that if you cant get financial approval for the purchase of a sure thing, you aren't going to get approval for a risky development.

5) In the case of this particular development, what I do know is that an individual with a bit of money and foresight has managed to purchase a number of adjoining properties and has put a development application to council and council have approved it. This is where things seem to have stopped... No public pre-leasing campaign, no agents being asked to try and source tenants, no sign of tenants winding up business, no sign of much at all...

This is speculation, but I personally don't think the current owner/developer has the capacity on their own to carry out this development. I think that if it weren't for this credit crisis, the owner would have looked to sell the property with DA in place, or tried to find a like minded JV partner to fund and manage the development.

I hear where you are coming from loud and you make some good points. Just out of interest my father has been a Bank Manager/Credit Manager for over 40 years and is well accross the challenges that the financial industry now faces. Sure things are far from being great out there at the moment (probably the understatment of the year) but financial institutions are not always going to shy away from a big project, especially if the numbers are right.

Anyway, the main point im trying to make is that more and more of these threads are filling up with pages of speculation about the GFC when anyone can pick up a paper and read about it themselves. All im saying is that the development threads should be reserved for factual information about that particular development rather than a littering of (generally negative) speculation.

End of Rant

[Watch the Birdy]

The owner of the site is selling it through Colliers, i took photographs for a brochure this week.