Commercial market demand lower

Press, 24 April 1979, Page 14

Commercial market demand lower

PA Wellington Rather than move into new premises, many comi panies are altering their I existing facilities, and this is i reducing the demand for I new buildings, the chairman i of Property Securities, Ltd I (Mr F. H.' Renouf) says in |his half-yearly report. ! “In the residential field.” he says, “the downturn in (house building continues to [affect the sale of sections. “Prospective home owners find it difficult to meet the high cost of building, preferring in some cases to purchase existing homes. “However, there have been a number of opportunities for the company, during the period under review (half-year to January 31) and the directors report a satisfactory profit for the first six months,” he says. The unaudited net profit is estimated to be $514,171, compared with $244,000 in the corresponding period of 1978. This includes extra-

ordinarv items of $174,000' (1978 nil) and allows' $268,621 for taxation, ($191,500 in 1978). Sales of sections, land.; and buildings occur at ir-j regular intervals during thel year, and the results tor the! half-year should not be! taken as being proportio-' nally indicative of the likely' results for the balance of| I the financial year, which! ends on July 31, the report says. An unchanged interim dividend of 12 per cent (6c a share) is being paid. This is on capital increased after last year’s bonus issue. A number of lease-back transactions have been completed. the most significant of which was the World Trade Centre in Wellington. "The company now controls a large amount of commercial space throughout the country which, except for an insignificant percentage, is fully let and income-produc--1 ng,” Mr Renouf says.

i; “In the 14« d subdivision i; field, the Christchurch subsidiary, Suburban Estates, | Ltd, continues to suffer from ,|the general downturn in the • sale of residential sections, Hand has returned a disilappointing profit. “However, the company is -j in a sound financial position J with a good supply of comfjpleted sections available for 11 sale in all price brackets, t and is well placed to meet any upturn in market dei mand. e “In view of the continuing ; uncertainty in the economy r in general, and the property market in particular, it is dic fficult to predict the likely - results for the balance of t the financial year to July 31. 1 “However, providing that there is no radical change in - current trading conditions - the directors are confident 1 that the final profit and 1 dividend levels will be well ’ received by shareholders,” he says.