Just listened through the 55 minute Results Presentation and (so you don't have to!) there were a few key points in the Q&A that may be of interest:
1) 1 California Plaza is "under contract". They have agreed a price but finalising terms. It sounds like the sale will go ahead and announcement will be forthcoming in due course. MOF only wanted to sell one US asset and thus the other 3 US assets that were for sale have been withdrawn.
2) Still tough leasing in US. To get new tenants rents are falling NET approx 15%-17%. This comes in the form of a 12-13% rental INCREASE (to keep the building values high) along with a -30% 'incentive payment' given to the new tenant. Thus a net fall in rent for term of lease.
3) For existing tenants renewing, read (2) above but change the number to read rental increase of 12-13% together with a similar, 12-13% 'incentive payment', thus nil underlying rental increases.
This, along with the other reasons disclosed in MOF's FY09 Presentation is why core FY10 earnings will be below 4.14cpu.
Cheers John
MOF Price at posting:
24.0¢ Sentiment: Buy Disclosure: Held
