This article is from the Australian Property Journal archive
MACQUARIE Office Trust has taken a $693 million hit against the value of its portfolio.
In the six months to December 31 2008, the trust was revalued its entire portfolio of 42 properties, which fell by 10.5% from $6.5 billion to $5.9 billion. This movement reflects a softening of capitalisation rates of 78 basis points to 6.95%.
Chief executive Adrian Taylor said this valuation movement was driven by a range of factors including a downturn in economic activity, a tightening credit market, which has weakened investment demand for property globally, and more conservative assumptions adopted by valuers which was particularly evident on properties with vacancy and upcoming expiries.
The trust worst performing markets were Europe and the United States. Three European offices were revalued and decreased $69.9 million or 12.6% to $486.9 million.
In the US, 15 properties were revalued and fell $405.4 million or 11.6% to $3.10 billion.
The value of the trust’s Australian assets fell 8.7% or $207.9 million to $2.19 billion and three Japanese properties fell $9.8 million or 7.8% to $116.4 million.
Taylor said the trust remains in compliance with all remaining debt and derivative covenants and has removed the head trust gearing covenant on the syndicate facility.
Australian Property Journal
