There goes the commercial property market – GE pulls the plug

johnboy 29 November 2008 11

The Canberra Times has a story on repercussions for the local property market with General Electric Real Estate forced to put its commercial property assets on the auction block.

This could also be a sign of things to come in the retail sector. GE’s finance division has run the credit for Harvey Norman which so many retailers have felt was pushing them out of the market.

If the mother ship is in enough distress to take a bath on commercial property it has so carefully collected in recent years how long can 18 months interest free continue?

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11 Responses to There goes the commercial property market – GE pulls the plug
I-filed I-filed 1:04 pm 30 Nov 08

Back off topic – I was disturbed to discover that the John Gorton building in Parkes is privately owned – all the iconic buildings in the Parliamentary Triangle should be publicly owned …

ant ant 10:25 am 30 Nov 08

That certainly is a fire sale. Shades of how the Packers did Bond all those years ago, too. That would suggest though that GE are in a world of trouble.

Mr Evil Mr Evil 9:32 am 30 Nov 08

I think the most amazing thing about this great GE sell off – “everything’s gotta go sale” is the fact that they have apparently sold the Manuka Capitol Theatre Bldg to the Liangis family for $20mil – after GE had purchased it from the Liangis family for $80mil last year!!!!

No doubt some toss in GE will be getting a multi-million dollar bonus for such great property investments! 🙁

Greedy bastards……

emd emd 8:04 pm 29 Nov 08

I wonder if this change in the commercial market is big enough to flow down to an influx of cheaper, smaller properties, or will only affect the mega-buildings?

VYBerlinaV8_the_one_they_all_copy VYBerlinaV8_the_one_they_all_copy 7:34 pm 29 Nov 08

I wouldn’t jump to conclusions about what the yanks will or won’t accept. My understanding is that their Federal Reserve Bank is a private company, created by legislation snuck through many decades ago on the evening of a public holiday when most voting members weren’t present!

taco taco 7:25 pm 29 Nov 08

ant said :

Is that “interest free” thing really a good deal? I thought it was like Muslim lending, no interest but the price is inflated to absorb the cost of the money.

From what I have gathered – it’s a good deal if you pay it in full back during the interest free period.
The repayments are designed to leave a remainder at the end of the term when you are slugged with nearly 30% interest on the remainder (I’ve also heard that they charge you the interest that had accrued during the “interest free period”, but I couldn’t find it in their terms and conditions)

They also have a host of semi-hidden fees and charges – account setup fee, monthly account keeping fee, huge late payment fee etc

2604 2604 5:30 pm 29 Nov 08

Eddie, just about every government building is privately owned nowadays, including all the “top secret” ones. My understanding is that most (if not all) of Russell is also owned by GE.

But, this goes on in every part of government procurement nowadays. For example, I remember reading in the paper a while back that Foreign Affairs and Trade’s secure satellite communications go over an Optus satellite (with Optus owned by SingTel, owned in turn by the Singapore Govt).

ant ant 1:22 pm 29 Nov 08

If you’re worried about Campbell Park being owned privately, you won’t like to hear who owns the new HQ JOC facility! Hint: it’s not Defence.

Is that “interest free” thing really a good deal? I thought it was like Muslim lending, no interest but the price is inflated to absorb the cost of the money.

taco taco 12:05 pm 29 Nov 08

I’m pretty sure GE have already announced plans to scale back their finance operations including the Harvey Norman 18 months interest free.

Gerry Harvey is so reliant on this sales model that he plans to start up his own finance company to continue the debt addiction

if GE were to pare back its finance arm, “we would then escalate our own finance company backup”.

johnboy johnboy 11:58 am 29 Nov 08

In practice though Campbell Park became a ghetto for whoever didn’t rate an office at Russell.

Back ontopic now…

Steady Eddie Steady Eddie 11:48 am 29 Nov 08

The most disturbing thing about the CT story was the revelation that the Campbell Park Offices – a secure Defence establishment – are in fact owned by GE, and that Defence (and the government) lease them from GE. Can you imagine the US administration selling The Pentagon to a private company? Campbell Park Offices were supposed to be Australia’s Pentagon – three more buildings were supposed to be built creating a pentagon shape, but the Fraser government abandoned it in the mid 1970s.

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