Table of Contents
Priced for survival, not recovery ...................................................... 3
Benchmarking A-REITs vs Australian equities...........................................................................3
SGP & MGR: leveraged to residential market recovery ............................................................7
GMG: leveraged to global trade growth; asset value recovery. ................................................9
NTA should be a price floor for stapled securities, not a ceiling .............................................12
Valuation & Price Target changes ...........................................................................................14
Valuing the real estate: what is the right cap rate? .................................................................14
What if the physical markets overshoot?................................................................................17
Valuing real estate vs equities.................................................................................................19
Consolidation follows recapitalisation .......................................... 24
The role of sovereign wealth funds & global pension funds. ..................................................25
Transaction activity likely to accelerate as valuations find a base ...........................................26
A-REIT refinance requirements ...............................................................................................28
Direct Real Estate Markets ............................................................. 30
Property yields vs bonds.........................................................................................................32
Australian commercial cycle ...................................................................................................33
Asset performance – Significant variation between classes in 90’s........................................34
Stock performance over the last recession.............................................................................35
US Direct markets...................................................................................................................37
UK market: signs of stabilisation.............................................................................................39
Appendix A: Depreciation, land values & useful life .................... 40
Appendix B: Residential project cost breakdown ........................ 49
Appendix C: Direct market transactions YTD ............................... 50
Price target, valuation & risks ........................................................ 53
Sector statistics ............................................................................... 57