Cushing takes aim at Property Trust

Sir Selwyn Cushing, who has been the trust's most outspoken critic, makes a point during the annual meeting. Photo / Glenn Jeffrey

National Property Trust yesterday got one tick in its favour and one against it from vociferous investor opponent Sir Selwyn Cushing.

At the trust's annual meeting held in Ellerslie, Cushing said he approved of the strategy to sell assets but he was worried about the trust's management being owned by troubled financier St Laurence of Wellington.

"You get one tick and one cross," said the patriarch of the Hawkes Bay-based family which has been the trust's most outspoken critic, attacking the manager for running an under-performing business and demanding last year that the trust to be wound up and proceeds paid back to investors.

Cushing yesterday called the trust's balance sheet "a disgrace" and demanded answers about the stability of its management.

"I would like to know if the manager is financially viable in the next 12 months," Cushing said.

Kevin Podmore, chairman of the trust's manager and St Laurence managing director, said he was pleased with Cushing's scorecard and was "lucky" to get at least one tick.

The trust owns real estate valued at $266.8 million and Podmore said it planned to sell Newmarket's Rialto Centre and Tauranga's Goddards Centre and Dumbarton building.

"The balance sheet is not what we would like but I wouldn't agree it's a disgrace. We've tried to rectify it and whilst we might not be there yet, it's a lot healthier than it was in 2006," Podmore said, citing debt-to-equity levels of above 50 per cent three years ago which today stand at 36 per cent.

Podmore acknowledged that the trust's manager was a subsidiary of St Laurence, subject to a moratorium to repay about 9000 investors owed $240 million.

"St Laurence is facing its challenges and there must be question marks over its future just as there is over many finance companies and banks," he said.

Unitholders were worried about the trust's short-term leases and Podmore admitted the trust had the shortest weighted average lease term in the listed property sector at around just three years. But he attributed this to many smaller retail tenancies which he said were usually let on terms of two initial years with rights of renewal for a further two years.

Another unitholder demanded to know what the trust was doing to grow but Podmore and director Brian Kreft said the trust was going through a consolidation phase in the difficult property market.

Asked when the property market would recover, Podmore said that was at least a year away.

Independent director Ted van Arkel did not seek re-election to the board and the managers proposed Kerry Hitchcock of Charta, who was elected.

National Property Trust units were trading at 40c yesterday.