DIVERSIFIED property group Australand has taken a $65 million writedown on four residential projects and five commercial and industrial projects following project delays.
However, the company, which last year fielded an offer from Commonwealth Property Office Fund suitor GPT Group for its investment properties and its office and industrial development business, announced a $44m increase in the value of its investment portfolio.
In a statement released to the market after close yesterday, Australand said about 90 per cent of the impairment related to projects in Queensland and eight of the projects were previously impaired.
The four impaired residential projects were all in Queensland.
Two Melbourne projects — an industrial development in Mulgrave and its office venture in Dandenong — were also written down, alongside three other industrial development projects in Queensland.
Australand chief executive Bob Johnston said the company would now move to offload portions of the residential projects carrying the new impairments.
“Given the recent improvement in volumes in Queensland, we will pursue strategies to accelerate capital recovery,” Mr Johnston said.
“In some cases this will include targeting englobo sales.”
With regard to the commercial and industrial projects affected by the writedown, Mr Johnston said demand in the industrial and office sector had remained relatively subdued for longer than anticipated.
He expected tenant demand in Queensland to remain challenging in the near term.
Australand shares closed up 3c yesterday at $3.88.
Source: The Australian
