67 Courtenay Street, New Plymouth
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| Investment Type | Proportionate Ownership Scheme |
| Distribution Rate p.a. | 10.00% |
| Annual Estimated Cash Distribution | $2,000.00 Gross |
| Note on Cash Distribution | Investors are paid their portion of profit quarterly in arrears. As such no witholding tax is deducted. Investors are sent an end of year summary stating their share of profit and depreciation allowance for tax purposes. |
| Auditor | KPMG |
| Make up of Investment Parcel | $20,000 per parcel |
| Issue Date | 16 July 2002 |
| Net Asset Backing per Parcel | $37,168 per parcel as at 31 March 2010 |
| Fund Issues | From the 31 March 2010 Annual Report: We are pleased to report that the Scheme achieved a net operating surplus per Interest of $4,100, significantly ahead of budget. This provided an investor return for the year under review of 20.50%. As forecast, $2,000 per Interest of this was distributed equating to a 10% per annum cash return. The overall result for the year was enhanced by the interest expense being substantially lower than in 2009. Bank debt remains at $3.66 million and at 31 March 2010 was 44% of the property’s assessed value. This debt has a repayment date of 1 January 2012 and as at 31 March 2010 the interest rate was 5.45%, being the lenders base rate of 2.85% plus a margin of 2.60%. In light of this result, as well as your usual quarterly distribution, we will be making a one-off distribution of $1,000 per Interest on 30 September 2010. We will also increase the cash distribution to 12.00% per annum with the first payment at the new rate being made on 31 December 2010. The Property As mentioned in last year’s update to Investors on the property, remedial work had been successfully completed on a main internal gutter where a construction fault had been causing some flooding into the office area below. In the year under review additional weather proofing work on the property’s Devon Street frontage has been completed. This work involved installing new extended flashings on the vertical joints of the wall cladding and replacing bolts with new stainless steel bolts. This work was required to prevent water penetrating the wall cladding above and below the upper roof level gutter and was funded from Body Corporate cash reserves without the requirement for an additional levy of Body Corporate members. As at March 2010 the property’s valuation was $8.30 million, a decrease of $214,477 on March 2009’s valuation. Whilst the decline in value was less than experienced last year soft economic conditions have continued to impact on commercial property values and our independent valuer’s views on the current market are reflected in the lower valuation applied to the Courtenay Street property. Over the coming winter our focus will be on working with The Warehouse to carry out required maintenance on the roof mounted air-conditioning units where the heat exchange coils in these external condenser units are in need of replacement. Whilst The Warehouse’s lease is not due to expire until mid-2013 we have entered into initial discussions with them in respect to an early lease renewal as the tenant would like us to replace the existing lighting with new T5 fluorescent fittings which require a lower power load and are significantly less costly to maintain. As you will be aware, the Scheme’s term is set to expire in July 2014. As the terms of the Scheme allow for an earlier wind-up, subject to investors’ approval, the Manager will continue to monitor market conditions with a view to recommending the property be sold if a favourable price can be achieved. |
Property
| Location: | 67 Courtenay Street, New Plymouth |
| Purchase Price | $6,720,000 |
| Valuation at Purchase | $6,800,000 |
| Current Valuation | $8,300,000 |
| Tenant Information | The property is leased to The Warehouse until July 2013 with two further rights of renewal of three years and one term of three years less one day. |