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LOCAL AUTHORITY PROPERTY ASSOCIATION CONFERENCE
CONNAL TOWNSEND
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“The role/relationship between local government and commercial property development (and where it’s heading)An update of the sectorEQB and seismic strengtheningLocal government amalgamationPlanning (including RMA reform, housing supply issues and infrastructure)”
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OFFICE
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MULTI-UNIT RESIDENTIAL
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INDUSTRIAL
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PUBLIC
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RETAIL
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CITIES ARE ECONOMIC DRIVERS
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CITIES CONTROL CAPITAL MARKETS
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IPD INDEX RESULTS TO OCT 2014
12.9%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14
Total return for direct commercial propertyannual return on quarterly periods to September 2014
Capital return Income returnTotal return Long-run average Source: IPD
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IPD INDEX RESULTS TO OCT 2014
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IPD INDEX RESULTS TO OCT 2014
0%1%2%3%4%5%6%7%8%9%
10%11%
Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14
Commercial property cap rate vs bond rateperiod ending September 2014
spread NZ: All property TB rate
Source: IPD.
GFC
Lehman Broscollapse
cap rate: c7.6%average spread: c370bps
cap rate: c7.0%spread: c55bps
cap rate: c9.0%spread: c300bps
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BUT LOCAL GOVERNMENT ALSO FRUSTRATES US
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BUILDING ACT
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CONSTRUCTION PRODUCTIVITY
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HOUSING SUPPLY & AFFORDABILITY
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HOUSING SUPPLY & AFFORDABILITY
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PLANNING
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HOUSING SUPPLY & AFFORDABILITY
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EARTHQUAKE
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FUNDING LOCAL INFRASTRUCTURE
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LAND DEVELOPMENT AGENCIES
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LOCAL BODY AMALGAMATIONS
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QUESTIONS?
www.propertynz.co.nz
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THANK YOU
www.propertynz.co.nz