Sensational-Adelaide.com

dbcrow wrote:Waymouth Street will be closed this weekend (the section between Topham Mall and KWS). I wonder if it's to install the second crane? I know the crane base is at the end of a small side street that runs off Waymouth St.

Aspen row with investors deepens over proposal to buy ATO building

* Bridget Carter
* From: The Australian
* February 17, 2011 12:00AM

A ROW has intensified between Aspen Group and its shareholders, after the company announced yesterday it would buy Adelaide's central city Australian Taxation Office building, subject to finance, from one of its development funds for $183.7 million.

The property, previously referred to as "Tower 8", forms part of Aspen Development Fund No 1's Adelaide City Central precinct.

As part of the agreement, Aspen would buy the land from the development fund and pay for the construction of the building, which is being developed by the fund. "The total cost to Aspen Group on completion of the ATO Building is about $183.7m, incorporating holding costs," the company said.

The total cash outlay would be about $164m, of which Aspen has already provided $18m, and the debt component of the total funding requirement was expected to be about $115m.

But the move comes after Aspen shareholder, Perth-based financial firm Entrust Funds Management and the company's former managing director, Angelo Del Borrello, requisitioned a meeting of shareholders in attempts to remove the majority of the board, claiming that the board lacked the property and funds management experience to improve performance.

Entrust's managing director, David Franklin, yesterday said the property should have been kept in a fund.

He said it seemed attempts by Aspen to sell the property and secure debt funding had been unsuccessful for what he described as a good asset. "Our strategy would be to fund it off-balance sheet, to grow the funds management business," he said.

Aspen's managing director, Gavin Hawkins, said the idea

of the fund was to on-sell developments.

"We had two buyers that had reached heads-of-agreement stage, but in the global financial crisis it is very difficult to secure the funding with a building that isn't going to be complete for October 2012," he said.

"It is an asset we would love to have on balance sheet to improve the quality of our portfolio and we will look over time to divest half. We think we will benefit."

Entrust, a long-term investor in Aspen and its funds, and Mr Del Borrello now hold 8 per cent of the votes.

Aspen's shares closed steady yesterday at 46.5c.