The rise of e-commerce has driven major brands to expand their footprint and therefore leasing activity.  Vacancy rates are at all-time lows and major development work is underway to meet demand.  Several AREITS are continuing their growth in this asset class and Transaction volumes were up to $3.5 billion in 2020, from $2.3 billion in 2019 – as recently reported.

So, what makes the sector tick?  Here are some attributes and advantages of the sector from our perspective.

Construction and development advantages

• Over time construction costs in the sector have been less susceptible to escalation than other asset types.  This stability provides greater confidence to Developers when planning their next project.
• The speed of construction enables Developers to receive a return on their investment earlier than most other forms of development.
• Tried and tested construction techniques in the sector generally lead to less variations than other forms of construction.
• There are also tax depreciation benefits available to developers / investors upon project completion.

Investment advantages

• Typically, industrial & logistics properties are leased to a single tenant who has responsibility for repairs, maintenance and lease expiry make good obligations.
• Relatively low levels of capital expenditure are required during the lease term.
• There are good opportunities for environmental and social governance (ESG) initiatives.  Both new developments and building improvement projects are taking up energy efficient strategies such as photovoltaic solar systems, rainwater harvesting, zero ozone depleting refrigerant choices, high efficiency air conditioning, time and presence controls and metering.

The following projects represent some of our recent capabilities and expertise within the sector, where we have managed Cost, Risk & Return.

	Target Distribution Centre, Foundation Road Truganina VIC Independent Certifier, Development Monitoring & Quantity Surveying – 62,000m2 Client: ESR/CIP & Charter Hall		Toll Mars Distribution Centre, Midwest Logistics Hub, Truganina VIC Independent Certifier, Development Monitoring, Quantity Surveying & Tax Depreciation Assessment – 45,000m2 Client: Charter Hall
	Uniqlo Distribution Warehouse, Midwest Logistics Hub Truganina VIC Independent Certifier, Development Monitoring, Quantity Surveying & Tax Depreciation Assessment – 35,000m2 Client: Charter Hall		Mainfreight Epping, 107 Gateway Boulevard, Epping VIC Quantity Surveying – 45,000m2 Client: Mainfreight
	Drystone Industrial, Estate Truganina VIC Technical Due Diligence – 44,000m2 Client: GPT		Telstra Data Centre, Clayton VIC Acquisition/Divestment Technical Due Diligence - 3.2 hectare site Client: Telstra / Centuria
	Aldi Distribution Centre Portfolio Acquisition/Divestment Technical Due Diligence – 370,000m2 Client: Aldi / Charter Hall Allianz		99 Sandstone Place, Parkinson QLD Technical Due Diligence – 54,000m2 Client: DWS Group GmbH & Co
	338 Bradman Street, Acacia Ridge QLD Technical Due Diligence – 55,000m2 Client: Mapletree		Lot 30, 247-263 Greens Rd Dandenong South VIC Quantity Surveying & Tax Depreciation Assessment – 16,000m2 Client: Logis Property Investments
	Ceva Logistics, Truganina VIC Independent Certifier, Development Monitoring, Quantity Surveying – 36,000m2 Client: Frasers Property		Salta Properties Portfolio, Dandenong South VIC Quantity Surveying & Tax Depreciation Assessments – 4 industrial warehouses 25,000m2 Client: Salta Properties
	.
	7 Dursley Road, Yenora NSW Development Monitoring, Quantity Surveying and Tax Depreciation Assessments - 65,000m2 Client: Fife Capital		9-13 Cool Street, Forestville NSW Development Monitoring and Quantity Surveying - 9,000m2 Client: Trumen Corp Pty Ltd
	8 Narabang Way, Belrose NSW Development Monitoring and Quantity Surveying - 4,000m2 Client: Life Property Group		50 Elwell Close, Beresfield NSW Development Monitoring, Quantity Surveying and Tax Depreciation Assessments - 8,000m2 Client: Hobson Holdings Pty Ltd

Please do not hesitate to call any of the people below to discuss your requirements: 

MELBOURNE
Rob Howells, Managing Director |  0437 649 082  |  rhowells@napierblakeley.com
Craig Smith, Director |  0407 371 664  |  csmith@napierblakeley.com
John Mathew, Director  |  0414 559 326  |  jmathew@napierblakeley.com 
Ian Gardner, Associate Director  |  0488 225 569  |  igardner@napierblakeley.com

SYDNEY
Alastair Walker, Director  |  0419 503 289  |  awalker@napierblakeley.com
Peter Hammond, Director  |  0419 980 901  |  phammond@napierblakeley.com
Peter Osborn, Director  |  0439 765 571  |  posborn@napierblakeley.com
Stephen Cooke, Associate Director  |  0409 228 552  |  scooke@napierblakeley.com

BRISBANE
Adam Greene, Associate Director  |  0409 724 395  |  agreene@napierblakeley.com
Paul Cosker, Associate Director  |  0434 400 107  |  pcosker@napierblakeley.com
Gavin Peach, Associate Director  |  0412 225 781  |  gpeach@napierblakeley.com
KY Pih, Associate  |  0408 933 660  |  kpih@napierblakeley.com

PERTH
Graham Rigby, Associate Director  |  0419 847 998  |  grigby@napierblakeley.com 
Jorden Morris, Quantity Surveyor  |  0457 001 545  |  jmorris@napierblakeley.com

Stephen is a trusted advisor who understands stakeholders desired outcomes throughout property and development cycles. He has a proven track record in identifying, assessing and mitigating a broad range of property risks associated with:

• technical and environmental due diligence;
• capital and maintenance expenditure planning;
• project management and development monitoring, and
• landlord and tenant make good assessment and negotiation.

Stephen has over 15 years of professional experience – 11 of which were spent in Sydney, advising a range Australia’s leading property Investment and Development Groups who are both local and international stakeholders in the property investment sectors.

He will  also work closely with our NSW Quantity Surveying Division, on some new large development projects coming to fruition with a need for both cost risk planning and development due diligence on the documentation, programme, heritage issues to be considered and the general services design assessment which may include GRESB and NABERS reviews.

For any further information or simply to say hello to Stephen you can contact by any of the following methods:

Stephen Cooke
Associate  Director
m. 0409 228 552
e. scooke@napierblakeley.com
a. L8, 20 Hunter Street, Sydney NSW 2000

For 33 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

MELBOURNE Rob Howells National Director o.   03 9915 6300 m.  0437 649 082 e.   rhowells@napierblakeley.com	SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

Napier & Blakeley are proud to announce that we have been selected and approved by Sustainability Victoria as a panel provider of services to assist owners of commercial property to apply for grant funding as part of their Better Commercial Buildings program.

The following table provides some introductory information relating to the program and for further details or to commence with an application please contact :

For 33 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

There are a number of questions to be answered:

• Are there any priority issues that need to be managed?
• What needs to be repaired, replaced or improved?
• When do these need to be done?
• What could safely be deferred?
• How much will it cost?
• What will be the return?

Napier & Blakeley have developed software which enables the allocation of budget forecasts as well as the associated tax depreciation benefits that may follow. These forecasts can be viewed by individual asset, by level, or tenancy, by whole building and by whole portfolio, providing an holistic insight to manage expenditure and priorities.

The initial assessment process is made possible by our Services Engineers, Building Consultants and Quantity Surveyors who have current cost information to produce cost estimates and property tax depreciation reporting aligned to the commercial goals of your business and intentions for the property.

Planning your capex strategy can increase your property’s potential:

• Needs can be prioritised.
• Cash flow can be improved through capital allowances and tax depreciation.
• Valuations can be improved.

There are many drivers for capital expenditure and some of the considerations include:

• Age, condition and remaining useful life of the structure, fabric and the building services.
• Performance of plant and equipment such as lifts and air-conditioning.
• Obsolescence, attractiveness to tenants and market positioning.
• Highest and best use.
• Compliance with Building Code, Premises Standards, accessibility, WHS and Environmental and Hazardous Materials.
• Statutory Compliance of the Essential Safety Measures and Building Energy Efficiency Certificates (BEEC) and NABERS prior to leasing or sale.

Here are some recent project examples:

		COMMERCIAL OFFICE PORTFOLIO OF 19 ASSETS – NATIONWIDE Including 108 St Georges Terrace, Perth WA CLIENT:  Brookfield SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast, Asset Registers and associated Tax Depreciation assessments
		RETAIL PROPERTY PORTFOLIO OF 14 ASSETS – NATIONWIDE Including Highpoint Shopping Centre, Maribyrnong VIC CLIENT:  The GPT Group SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast
		PRIVATE HOSPITAL PORTFOLIO OF 20 ASSETS – NSW, VIC, QLD, SA Including Robina Private Hospital, Robina, QLD CLIENT:  Australian Unity SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast
		6 STAR AGED CARE AND INDEPENDENT LIVING, VAULCLUSE Including 2 Laguna Street, Vaucluse, NSW CLIENT:  Mark Moran Group SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast
		AGED CARE AND RETIREMENT LIVING PORTFOLIO, NSW & QLD Southern Cross Care Residential Aged Care, Daceyville NSW CLIENT:  Southern Cross Care SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast
		COMMERCIAL OFFICE PORTFOLIO, NSW & QLD Including 50 Pitt Street, Sydney NSW CLIENT:  Mirvac SERVICE COMMISSION: Life Cycle Assessment, 10 year Capital & Maintenance Expenditure Forecast

Our Transaction Advisory team is able to provide the following services for your projects:

• Land transaction technical due diligence
• Project / development monitoring
• Property transaction technical due diligence and benchmarking
• Property condition assessments
• Capital and maintenance expenditure forecasts
• Operational performance reviews and expenditure analysis
• Energy efficiency assessments
• Building improvement reports
• Environmental and hazardous materials assessments
• Regulatory compliance reports, BCA, OHS/WHS, ESM
• Town planning reports
• Land and lease surveys
• Indicative property depreciation schedules
• Replacement cost estimates
• Landlord and tenant dilapidations
• Make good assessments and negotiations

Please do not hesitate to call us to discuss your project:

NATIONAL Rob Howells o.  03 9915 6300 m. 0437 649 082 e.  rhowells@napierblakeley.com	PERTH Graham Rigby p.  08 9489 4895 m. 0419 847 998 e.  grigby@napierblakeley.com
SYDNEY Peter Osborn o.  02 9299 1899 m. 0439 765 571 e.  posborn@napierblakeley.com	BRISBANE Gavin Peach o.  07 3221 8255 m. 0412 225 781 e.  gpeach@napierblakeley.com

For 33 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

A happy 2018 and a happy Chinese New Year to all our clients and friends of Napier & Blakeley

We are already off to a busy start with expectations of substantial Real Estate Investment activity in our region over the year ahead.

2017 saw many milestones for us and our independent and trusted advisory services throughout which we worked on:

3,995
new jobs

More than $20b
of property or
insurance purposes

More than 600 technical due
diligence reports for vendors,
purchasers and financiers of
property or development

More than 550 development
projects as either cost planner,
independent QS, superintendent
or independent cost certifier for
developers or development financiers

Over 2,000,000 m2
of property for start and end of
lease and make good purposes

Hundreds of millions of dollars of tax
deductions for clients, for either property
acquisitions, refurbishments, capital
expenditure or demolition write offs

15 new
Team
Members

Over $22k raised
for local charities

We look forward to assisting all our clients and hopefully many new ones in 2018 and we wish every success to all over the year ahead.

For 33 years Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

2017 was another significant year in property, the highlight of which was pricing within the commercial office sector which produced some record yields in Australia.

It was also another busy year for Napier & Blakeley, with our independent trusted advisory services again being in great demand from both local and offshore clients investing in Australia and SE Asia across the property, development and sustainability industries.

In 2017, we again managed client projects across all states and territories of Australia and also an increasing number of projects across the Asia Pacific region.

We would like to say a big thank you to all of our clients and send all of you and your families our Season’s Greetings.  We look forward to working with you again and to a successful and prosperous 2018 for all.

Our offices will close at 5pm on Friday 22nd December and reopen on Monday 8th January.

Should you have any urgent business during that time, please contact Peter Frith on +61 418 733 987 or on pfrith@napierblakeley.com.

For 32 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

In June 2017, TrustCapital Australia (TCA) engaged Napier & Blakeley to undertake Vendor’s Technical and Environmental Due Diligence relating to their commercial office portfolio.

Within two weeks of instruction we had reviewed all the available documentation, inspected all the properties and provided written feedback on our findings.

We were able to achieve this using our national team of building consultants, services engineers and cost consultants, in conjunction with external environmental consultants from our approved consultants panel.

This early stage reporting provided TCA, and their Facilities Managers, the opportunity to act upon minor items of deferred maintenance and short term future repairs and maintenance needs, to help prepare the properties for sale.

While the repairs were underway Napier & Blakeley completed the final  written reports.

Our reports covered the technical and environmental aspects of the property and risk assessment was facilitated by capital and maintenance forecasts over a ten year period.

Items in our forecasts are categorised by the detailed scope of the instruction along with a probability rating of the likelihood of such events occurring.

Due to the active management of the investment grade properties, our reporting was able to confirm low levels of future capital maintenance requirements, which were below benchmark levels for properties of a similar age and type.

The marketing campaign commenced in July and contracts were exchanged on all five properties (four purchasers) by September.

Being independent from both the sales process and property management provided further value in that Purchasers could take reliance on the reports, free from any conflicts of interest, as if the reports had always been prepared for themselves.

Reliance was extended to Purchasers on three out of the five properties.

Napier & Blakeley

With 32 years in the property, development and advisory business we have an intimate knowledge and understanding of costs and workings across the built environment.

This experience has allowed us to develop a unique data base of costs and condition based capital expenditure forecasts, for benchmarking purposes.

Napier & Blakeley pioneered technical due diligence services in Australia 25 years ago and remain as the market leader for these services today.

We were instrumental in the RICS Best Practice Guidance Note for Technical Due Diligence of Commercial and Industrial Property and also provide support to other industry bodies.

Our capability and resources align with our brand promise of providing commercially oriented advice in a timely manner and in a user friendly format.

Our technical due diligence reporting also provides a detailed working platform to transition into an asset management plan for new owners.

Year to date we’ve completed technical due diligence on properties totalling in excess of $15 billion of transactions covering commercial, retail, logistic, health and hotel property, for both vendors and purchasers who value complete independence.

For further information on our Transaction and Advisory services please contact our team here:

NATIONAL Rob Howells o.  03 9915 6300 m. 0437 649 082 e.  rhowells@napierblakeley.com	PERTH Graham Rigby p.  08 9489 4895 m. 0419 847 998 e.  grigby@napierblakeley.com
SYDNEY Simon Gould o.  02 8113 7112 m. 0409 228 552 e.  sgould@napierblakeley.com	BRISBANE Gavin Peach o.  07 3221 8255 m. 0412 225 781 e.  gpeach@napierblakeley.com

For 32 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

Costs, Risks and Returns

Since the Lacrosse Apartment building fire in 2014 and the tragic Grenfell Tower fire of 2017, there are still more questions relating to the use of flammable ACP than answers.

Industry, governing bodies, financiers, building owners and occupiers, are yet to really understand their options.

• Will the import and use of flammable ACP in Australia be banned? – one of the suggestions made by the Senate’s interim enquiry report.
• Will the National Construction Code and Building Regulations be revised to require increased fire safety around the use of ACP? – as suggested by the current draft amendment out for public comment.
• Will the ‘grey area’ of whether the ACP is an attachment or part of an external wall be confirmed?
• Will Government required audits lead to large scale removal of flammable ACP and replacement with compliant materials?
• Will insurers carve out flammable ACP from insurance policies?  Will premiums increase?
• Is the reputation of ACP tarnished so much so that developers and architects turn their back on the material – as recently reported by Uniting Communities with their U City development in Adelaide?

These Grey Areas are Red Hot in the Property Sector

Aluminium cladding has been used for many years in Australia.  Panels can be solid or composite with a core material. Composite panels came into use in the 1990’s.

Those with a flammable 100% polyethylene core have become the subject of much discussion and scrutiny.

Composite panels with fire retardant cores were introduced in 1999 (such as Alpolic FR) and around 2012 (such as Alucabond Plus and A2).

Externally, the panels look much the same. Determining the product and type can be challenging and generally require a desk-top and an on-site audit.

Risk Management First Step… Audit what’s there

The aim the building audit is to ascertain the presence and extent of any flammable ACP, the risk it poses in terms of ignition and fire spread and the cost of available mitigation strategies. Reportedly, cladding replacement at Lacrosse is in the order of $1,000 / sqm of façade area.

The audit process typically includes a desk-top assessment of architectural drawings and specifications, cladding installation drawings, operation and maintenance manuals and warranties, together with interviews with installers and manufacturers.

The desk-top study often needs to be supported by on-site inspections and if required, physical samples can be taken and assessed for identification purposes.

Where flammable ACP is found, a quantitative risk assessment should be undertaken by a qualified Fire Engineer. The various fire spread paths can be ranked and mitigation strategies can be identified.

Cost estimates for recommended solutions can then be prepared by a quantity surveyor or a building consultant.

The building audit is the starting point of a risk management strategy and will help to navigate the changing landscape as answers are provided to the questions.

References:

http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Non-conforming45th/Interim_report_cladding

AS 5113:2016 Fire Propagation Testing and Classification of External Walls of Buildings

https://www.abcb.gov.au/Consultation/Public-Comment-Draft

For further information on ACP and building audits please contact one of the team here:

NATIONAL Rob Howells o.  03 9915 6300 m. 0437 649 082 e.  rhowells@napierblakeley.com	MELBOURNE Micheal O’Gorman p.  03 9915 6330 m. 0488 285 221 e.  mogorman@napierblakeley.com
SYDNEY Simon Gould o.  02 8113 7112 m. 0409 228 552 e.  sgould@napierblakeley.com	BRISBANE Gavin Peach o.  07 3221 8255 m. 0412 225 781 e.  gpeach@napierblakeley.com

PERTH Graham Rigby o.  08 9489 4895 m. 0419 847 998 e.  grigby@napierblakeley.com

For 32 years and counting Napier & Blakeley have been providing the following services to the property industry:

• Property Acquisition & Disposal Technical Due Diligence
• Property Development Due Diligence
• Quantity Surveying
• Capital Expenditure Forecasting
• Make Good Reporting
• Energy Management
• Development Monitoring
• Property Tax Depreciation

Please contact any of the people below for more information or assistance:

SYDNEY Alastair Walker Managing Director o.  02 9299 1899 m. 0419 503 289 e.  awalker@napierblakeley.com	MELBOURNE Craig Smith Director o.  03 9915 6300 m. 0407 371 664 e.  csmith@napierblakeley.com
BRISBANE Paul Mazoletti National Director o.  07 3221 8255 m. 0408 749 202 e.  pmazoletti@napierblakeley.com	SINGAPORE Peter Mitchell Chairman o.  +65 6550 9642 m. +65 9670 9435 e.  pmitchell@napierblakeley.com

“There is still a substantial amount of investment funds under management looking for a home – and the volatility in other markets serves as a reminder that Australia remains a safe haven,” says Walker (pictured), who oversees the independent property, development and sustainability consultancy.

The latest investment intentions survey from the Asian Association for Investors in Non-listed Real Estate Vehicles (ANREV) reports around AU$82.4 billion is expected to be poured into property in 2016, with the top three investment destinations in the regions of Tokyo, Sydney and Melbourne.

“Opportunity is now the great conundrum facing investors,” Walker warns.

“Australia presents a transparent market with a good yield to debt ratio, but a shortage of stock is limiting investment opportunity.

“The local property investment groups who have righted their ships in the last seven years after the Global Financial Crisis are now heavily challenged by offshore investors, some with very deep pockets.”

Last year was a record year for office investment, with around $30 billion turnover in commercial property, according to Savills latest report.

Foreign investors were the most active purchasers in 2015, acquiring 46 per cent of the stock sold, or $7.6 billion worth of office transactions.

“Our chairman, Peter Mitchell, is based in Singapore, and travels around Asia talking to investors and we get reports back every day, especially from Chinese investors wanting to get into the Australian market. These aren’t just big global funds, but a range of investors who see Australia, and particularly Sydney, as an attractive destination,” he adds.

While Sydney and Melbourne remain the “first choice” for offshore investors, Walker says they are increasingly looking further afield – and are looking beyond traditional shiny new offices.

“Expect retrofitting of existing assets – something that has been slow off the mark – to become a bigger thing in 2016,” Walker says.

“There is a substantial amount of commercial office stock in fantastic locations – and it just needs to be brought into the 21st century,” he says.

“Carbon may have gone off the boil in the media, but the drivers to improve existing buildings remain. While investors will always look at the bottom line return, there’s a massive opportunity sitting there waiting for us to capture.”

Established in 1985, Napier & Blakeley is an independent and privately-owned, international, integrated, property services consulting organisation. To find out more, visit: www.napierblakeley.com

Published on PCA Website
1 March 2016

Napier & Blakeley managing director Alastair Walker said the appointment is part of the group’s continued expansion into Asia.

“Peter brings to N&B a huge array of skills and contacts and as a lawyer has worked in due diligence throughout Asia in the past. His understanding of the Asian property market is second to none.

“He also has extensive networks in all major Asian economies and a deep understanding of their cultures and business practices,” he added.

Walker said Napier & Blakeley has worked for Singaporean clients for over two decades and have actively been involved in the region for almost 10 years.

“We have provided technical due diligence for around 75% of all international property investors coming into Australia, and formalising Peter’s involvement via his chairmanship will strengthen the links to these and other international investors and facilitate the development of greater capability to provide TDD services to them, as well as outbound Australian clients within Asia itself, pushing to Europe,” Walker continued.

Mitchell was most recently CEO of APREA in Singapore, having developed the association from a small 40-member body to almost 200 members globally.

Under his guidance, APREA is now recognised as the most important pan-Asian networking organisation in the region, having been awarded the international Real Estate Society’s 2009 Corporate Excellence Award. It remains the only Asian association to have received this award.

During his term, Mitchell oversaw the establishment of the most comprehensive listed real estate index series for the Asia Pacific, in partnership with Thomson Reuters and GPR, as well as the establishment of a suite of practical and applied training programs under the banner “APREA Institute”, with programs delivered in Singapore, Hong Kong, China, India, Malaysia, China, India, Malaysia and the Philippines.

He also presided over the management of a chapter network to decentralise APREA, with chapters created in China, Japan, Hong Kong, Singapore, India, Malaysia, the Philippines and Australia.

Mitchell practised as a lawyer for 30 years in Melbourne before moving to Singapore to act for an Australian client on the proposed first REIT in Singapore, to be a joint venture with a major Singapore company which was eventually launched as the Capital Mall Trust.

Significant advisory roles Mitchell has undertaken throughout his legal career include:

• Secondary listing in Singapore of an Australian securities fund
• Acquisition of retail assets and establishment of a private real estate fund in Singapore
• Allco REIT IPO in Singapore
• YTL Starhill REIT IPO in Malaysia
• Ulu Pandan NEWater PPP project bid (Singapore)
• T101 (Taipei) development
• Acquisition of Parkway Parade, Singapore
• Grand Hotel Trust IPO in Australia
• Acting for European and Asian pension funds and sovereign wealth funds as investors in a wholesale retail fund in Australia
• Acquisition of private hospitals and negotiating PPP hospital agreements for an operator in Australia

 Displayed in the Property Review  –  21 August 2014