Return of Chalmers Property

Geoff Plunket
Geoff Plunket
Port Otago is relocating its subsidiary company Chalmers Property, which overseas a $197 million property portfolio around the country, from its Wellington headquarters to Port Chalmers.

Chalmers' three Wellington staff are not relocating south, but Port Otago will maintain a presence in Auckland with a contracted property manager.

Within Chalmers' $197 million portfolio, $110 million is in Dunedin, $65 million is in Auckland and the balance of $22 million is in Hamilton. Chalmers is a partner in a 50:50 joint venture in Hamilton.

Since Chalmers began trading in 1998, its property values have increased by $120 million.

Port Otago chief executive Geoff Plunket said a review of Chalmers had decided because its largest holding was in Dunedin it was "under-represented" here, and the head office should be relocated.

Longtime Chalmers chief executive Andrew Duncan is not relocating to Dunedin and a job for general manager of property is being advertised by Port Otago. The job is to be based in Port Chalmers, with administrative support.

When asked if Mr Duncan was receiving a severance package, Mr Plunket said under Mr Duncan's employment agreement "Chalmers Property would meet all its obligations" to Mr Duncan, but he declined to give any further details.

Mr Duncan maintains a small stake in the Hamilton joint venture.

For the previous financial year's results, year ending June, which were released last September, the contribution of Chalmers Property was again the subject of valuation volatility during the period.

Chalmers lost $5.2 million from overall property values; compared with a gain of $3.2 million a year earlier. Rental income for the year was a record $11.3 million, up slightly from $11.1 the year before and profit from a Dunedin sale during the year was $1.7 million. Earnings before interest and tax were up slightly at $10.8 million.

At the time, its overall property portfolio, of which 54% by value was in Dunedin, booked a 4% decline to $197 million.

Auckland was down 7% to $69 million and Hamilton properties were also devalued by 7%, to $25 million, while the Dunedin properties made a slight gain in value.

- simon.hartley@odt.co.nz

 

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