Colonial taps into Kiwi

By ANNE GIBSON

A banking chief and a group of Australians have taken board seats at listed Kiwi Income Property Trust's management company following its sale this year.

ASB Bank deputy chairman Jim Syme is Kiwi's new chairman. The bank's link to Kiwi comes via the trust manager's new owner, Colonial First State Property, which is owned by Australian financial services giant Colonial First State Group, a subsidiary of the Commonwealth Bank of Australia, which owns ASB Bank and Sovereign Life here.

Syme, raised in Canterbury, is also a director of Waste Management, Metrowater, Software of Excellence International and Eldercare.

Kiwi founders Ross Green and Richard Didsbury resigned as the trust's joint managing directors in March and at the same time Colonial bought Kiwi's management company.

Green is a consultant until December and Didsbury an independent director and trust consultant.

Colonial has appointed key executives to the management company board: Wal Edgell, Colonial's general manager corporate services; Bob Kelly, head of Colonial's funds management; and John Duncan, ASB Bank's group general manager financial and risk management.

Colonial bought the management company for an undisclosed sum from another Australian firm, Lend Lease.

Details of the deal are not in Kiwi's annual report.

"Colonial's influence has yet to be fully realised," Syme writes in his summary.

The change of ownership at Kiwi's management company is a significant event, he says.

Colonial has $16 billion of property under management and runs two other New Zealand listed property trusts: Colonial First State Property Trust, with headquarters in Wellington; and the management of Newmarket Property Trust, under an offer from listed National Property Trust of Christchurch.

Colonial has assured itself of an income stream by buying Kiwi's management company.

Although the report does not disclose details of the sale, it declares the payment of $7.2 million in the March year as a related-party transaction.

That is up from the previous year's $5.9 million.

Kiwi has a $300 million revolving loan facility with ANZ Banking Group, Bank of New Zealand, HSBC and Citibank NZ. This will expire in 2004.

The report says Sylvia Park Business Centre is a significant subsidiary. The development, worth about $500 million, will transform 21ha of industrial land at Panmure into a multipurpose commercial centre.

Kiwi chief executive Angus McNaughton said the master plan for Sylvia Park was being completed, talks were being held with major tenants and the structure and financing of the deal were being settled.

Kiwi has $800 million worth of real estate in New Zealand, including large office blocks and shopping malls.

It values its Royal & SunAlliance Centre in Auckland at $201 million ($202 million last year), Majestic Centre in Wellington at $71 million ($68 million), National Bank Centre in Auckland - in which it has a half-stake - at $46 million ($50 million), Vodafone House in Auckland at $39.6 million ($40.5 million), PricewaterhouseCoopers Centre in Christchurch at $33 million ($32.7 million) and AUT Arts Faculty Building in Auckland at $26.7 million ($28.3 million).

It lists commercial property valued at $476 million ($492 million last year).

Kiwi's largest shopping centre is Northlands in Christchurch, valued at $85.5 million ($84 million last year), followed by North City in Porirua at $82 million ($80 million) and Centre Place in Hamilton at $74 million ($69.2 million).

The retail portfolio is valued at $323 million ($313 million last year).