Another REIT Resigns as Market Remains Weak

FKP Chief Executive Peter Brown is reportedly retiring after almost 10 years of service. His departure follows a succession of resignations in the real estate industry.

Just last week, Nich Collishaw announced that he will step down as managing director of Mirvac by October of this year. Matthew Quinn, meanwhile, will retire as Stockland’s head.

Industry analysts said more are expected to retire, pointing out that these recent developments are perhaps a result of the earnings downgrade. Analysts also warned of more difficult times ahead.

The REIT cycle is also at its lowest in the past few years, while consumer trust is reportedly low, thus putting pressure in the retail, residential and office property markets.

Nevertheless, the REIT sector has been trying to outperform the sharemarket in general, as rent collecting is being ascertained so the industry remains stable. Investors also have stored cash in safe havens, and most retail landlords are still earning from this.

A problem could arise again, however, if landlords decide to increase rents and leases, when renewals are up for next year.

Property companies remain steadfast as Mirvac, CFS Retail, Commonwealth Property Office and Peet Corporation release its latest reports today.

According to sources, Mirvac chairman James MacKenzie has confirmed that there would no longer be material writedowns to its residential book. The industry, however, is waiting for an update on the commercial development pipeline of Mirvac and the launch of new funds management initiatives.