August 2021 - Bay of Plenty Business News

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16 BAY OF PLENTY BUSINESS NEWS August 2021 NEWSBRIEF Council purchases land as part of marine precinct strategic review Tauranga City Council is set to buy back a key area of land at Sulphur Point as growth plans for the Tauranga Marine Precinct continue to be developed. Council sold the land at 6 Cross Road to Pacific 7 Ltd in 2016 to help fund the development of the marine servicing hub ‘Vessel Works’ – a council entity that opened in 2018 and provides a marine servicing facility for commercial and recreational boats. Recently, Tauranga City Council had the opportunity to repurchase this site. Tauranga City Council General Manager of Corporate Services Paul Davidson says “the opportunity to buy was taken as it allows time to review how changes to the ownership of this landholding may impact the wider precinct and its users”. “A strategic review of the marine precinct is currently underway, so it made sense for us to purchase the land while the review is completed this year. This will also allow progress to be made on other future land sale opportunities as part of planned future development,” says Paul. “The goal of the strategic review is to ensure the marine precinct is developed and best positioned to deliver benefits for the local industry and the wider community in the future.” Marine precinct users will be included in this strategic review. “We value the stakeholders in our local marine industry, and we are committed to working alongside them to understand how our goals may align in the future,” says Paul Greener leases There is significant dialogue happening in the office sector currently around ESG – environmental, social and governance – and how these three pillars or performance indicators are used to assess a company or investment project to determine its sustainability. Office tenants are increasingly seeking to adopt a strategic approach to sustainability, given expectations about carbon footprints and the balance sheet benefits that energy efficiencies can bring to a business operation. With 40 percent of carbon emissions coming from the built environment, the “E” component of ESG and commercial property are firmly in the spotlight and the corporate world is transitioning to a lower carbon, more sustainable, and more resilient future where people and community are paramount. Cost-effectiveness and energy-optimisation Having an energy management plan based around cost-effectiveness and energy-optimisation is central to a business’ sustainability goals and Steve Rendall, Bayleys national director office leasing, said “greener” leases are becoming more prevalent – particular among corporate occupiers. “Today’s commercial property occupants and their employees expect landlords to take meaningful steps to improve the sustainability footprints of the building they occupy. “As awareness of climate change increases and the built environment comes under greater scrutiny, landlords will be under growing pressure to be proactive in the sustainability space. “Larger public sector and corporate occupants are depending on measurable and reliable sustainability data for reporting back to stakeholders, so landlords and/or their facility managers, will need to be across the terminology, the standards and the expectations.” Rendall said conversations around sustainability need to be upfront at the time of establishing or renegotiating a commercial office lease, with clear definitions around who is responsible for what. “The more proactive tenants are, the more likely the sustainability narrative will get traction. “Occupiers need to ensure that the leases they sign reflect the sustainability principles that are important to their business, their employees and stakeholders.” The Covid-19 scenario has heightened the need for buildings to be healthy places for people to work in. Office occupiers need to be able to attract and retain staff and commit to the health and wellness of its employees, while doing the right thing by its community, and the environment. Issues for the switched on landlord A switched on landlord will need to consider many factors contributing to a building’s energy efficiency, from building design, operation and maintenance, to building management and occupant behaviours. Energy performance needs to be trackable, measurable and tenants and landlords will need to work closely to achieve a common goal of energy efficiency. New Zealand’s goal is to attain net-zero carbon emissions by 2050, so the government has tasked itself to make the public sector carbon-neutral by 2025, and to be an exemplar for the private sector to follow suit. All government departments and ministries are now required to measure their emissions and offset the ones they cannot remove by 2025, and to only occupy buildings meeting energy-efficient thresholds with NABERSNZ ratings. Paula Bennett, Bayleys’ director strategic advisory, said there is now a clear opportunity for the government to lead on the sustainability front and to be definitive in their expectations. “More can be, and needs to be, done as we seek to lower emissions in New Zealand.” www.bayleys.co.nz/workplace/ office/insights At Bayleys, we believe relationships are what businesses are built on and how they succeed. We understand that to maximise the return on your property you need: Professional property management A business partner that understands your views and goals Contact the Bayleys Tauranga Commercial Property Management team today. Bayleys Tauranga Commercial Property Management 07 579 0609 jan.cooney@bayleystauranga.co.nz SUCCESS REALTY LTD, BAYLEYS, LICENSED UNDER THE REA ACT 2008 ALTOGETHER BETTER Residential / Commercial / Rural / Property Services
August 2021 BAY OF PLENTY BUSINESS NEWS 17 Three options for income starved investors With the economy having recovered strongly from the events of 2020, the Reserve Bank is paring back its monetary stimulus programme. By MARK LISTER, Head of Private Wealth Research – Craigs Investment Partners Interest rates are set to rise from record lows, and we’ve already seen mortgage rates and term deposit increase in recent weeks. However, this will be a gradual process and interest rates are still likely to remain below historic averages for an extended period. In the meantime, what options are there for New Zealanders relying on their investments for income? 1. You can adjust your lifestyle and spending habits to match the lower levels of income Spending less is a valid option. Many of us spend more than we need to and would do fine being a little less frivolous. Last year’s lockdowns taught us that. But where’s the fun in that? Especially when you’re working hard to be able to retire with a bit of capital behind you to enjoy a good standard of living when you’ve hung up your boots. 2. You can modify your investment strategy and seek out higher yielding assets Another option is to give up on low-yielding conservative assets and shift those funds into shares or property, which offer higher returns. The New Zealand sharemarket is offering an annual gross dividend yield of 3.6 per cent, on average, with some sectors and companies much higher than that. Similarly, according to the Real Estate Institute the rental yield on a Bay of Plenty property is 3.3 per cent, while some other regions are higher still. In addition, both shares and property have historically provided attractive capital growth on top of those income returns. There’s a catch though. Dividends and rents are far from guaranteed, and in the short-term capital growth can be non-existent or even negative. The last thing you want is to be in the position of needing to cash up your share portfolio or sell your property during a rough patch. Moving into riskier assets can be an acceptable and logical course of action, if you have a reasonable time horizon and you don’t overdo it. 3. You can stay the course but eat into your capital to make up the shortfall The third option is to spend the income your portfolio is generating and when you need more, spend a little of your capital from time to time. One of the best things about shares is their liquidity, giving you the option to sell small parts of your holdings easily and cheaply.” Many Kiwi investors are averse to this approach, and are determined to leave every last cent to the next generation. However, the total return (the combination of the capital gains and the income) of an investment portfolio should be considered a pool of income available to be drawn on as required, not just the interest or dividend payments. One of the best things about shares is their liquidity, giving you the option to sell small parts of your holdings easily and cheaply. You can’t do that with many other asset classes, and investors can use this to their advantage when managing cash flow and income requirements. A key advantage of this approach is that there is no need to dramatically adjust your investment philosophy or risk profile, for the sake of boosting yield. Viewing returns as returns – regardless of where they come from – means you can maintain a well balanced portfolio of assets that matches your tolerance for risk and continue enjoying the good things in life. For quality investment strategies contact your local Craigs Investment Partners branch. Tauranga branch – 07 577 6049 tauranga@craigsip.com Rotorua branch – 07 348 1860 rotorua@craigsip.com craigsip.com This information is of a general nature only and does not constitute regulated financial advice. It does not take into account your particular financial situation, objectives, goals, or risk tolerance. Investments are subject to risk and are not guaranteed. Past returns are no guarantee of future performance and returns can go down as well as up. Before making any investment decision Craigs Investment Partners recommends you contact an investment adviser. Craigs Investment Partners Limited is a NZX Participant Firm. For more information on Craigs financial advice services please see craigsip.com/tcs. Sharp Tudhope Lawyers welcomes James Dow to the Partnership Sharp Tudhope is delighted to announce the addition of James Dow to the Partnership. James is a commercial, corporate and projects expert with extensive experience across many sectors gained from his time at top tier law firms in New Zealand and internationally at a global law firm in London. He provides practical solutions to complex commercial issues and in his first few months with the firm has already forged strong relationships with our clients. He says, “I’m thrilled to be joining the Partnership at Sharp Tudhope. The firm has an amazing reputation with clients nationwide and this year we celebrate 125 years of providing legal services in the region. I’m excited about continuing to strengthen the business relationships I have made since joining Sharp Tudhope and proud to be part of a firm that has such a long and illustrious history.” James brings a timely wealth of experience to the Bay of Plenty as its thriving industries continue to experience unprecedented growth. Partner Richard Hoare says, “Since joining us in March, James has quickly established himself and has demonstrated that he will be a key contributor to the firm and its progress. He brings a valuable skill-set to the Partnership and we are delighted to confirm his appointment.” Level 4, 152 Devonport Road Tauranga 3110 07 928 2000 lawyers@st.co.nz www.sharptudhope.co.nz James Dow
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August 2021 - Bay of Plenty Business News

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