research, page-10

I should point out that I was happy to buy another GMG parcel today.

GMG "will not be technically cheaper", means to me that other than for acts of god, or acts for which no one can predict, such as drops in the general economy, GMG will not fall.

In terms of its operations and fundamentals, I am glad to see that the current re-rating of GMG was to 5 out of 5 LT and 3 out of 5 St. A very positive outlook overall, no less. You can look around but not too many companies have results in both of these categories.

If anyone has news of the broader trading I would be surprised to find that property markets are backing off. I post the following article showing what I expect to see in the USA where the commercial and residential downturn is hitting hardest. When you read this remember that GMG is not so much in the USA as it is in other more prosperous economies. However the USA is picking up for the reasons I have been posting. The reason we are seeing a 5 out of 5 long term buy is because in 1 to 3 years we are going to see an upswing for which GMG is positioning itself very well. I am speculating that this trend, along with Dividends will bring investors to GMG, because GMG is investing, NOT selling.


Commercial real estate activity picking up
By Gertha Coffee
The Atlanta Journal-Constitution
Lavista Associates recently sold 11 office buildings in 40 days.

Ackerman & Co. has seen its transaction volume almost double.

And Carter announced Thursday that a New York equity firm paid $11.3 million for a renovated 216,000-plus square foot shopping center in Augusta. Atlanta-based Carter said the deal drew interest from the investor market nationwide.
Heavily discounted prices and more available financing have created a flurry of activity for metro Atlanta commercial real estate brokers. Industry experts said they expect gradual improvement to continue this year because sellers are becoming more reasonable about prices and lenders are back in the market.
Still, commercial property sales in metro Atlanta fell 66 percent in the 12 months ended March 31 vs. the same period a year earlier, according to LoopNet, an online commercial real estate listing service. Sales totaled $1.9 billion, compared with $5.5 billion for the same period in 2009.
Lower prices, however, have sparked recent buying activity, according to people in the industry.
There is a perception that now is the right opportunity to buy and that pricing from the sellers is becoming more realistic, said Tom Davenport, president of Atlanta-based Lavista. There has been a lot of pent-up demand for commercial assets. The flurry of activity, the velocity, has surprised us. Last year this time, we werent selling.
He said prices in the Atlanta market have declined by as much as 30 percent over the past three years.
Ten of the 11 buildings sold had gone through foreclosure, Davenport said. The sales swept a wide path across the metro area, including Atlanta, Acworth, Loganville, Duluth, Norcross, Lawrenceville, Suwanee, Alpharetta and Cumming.
Nine sales were to owner-occupier buyers. The company is off to a strong second quarter, he said, with a number of buildings sold or under contract.
Brokers are getting calls from investors because they see prices resetting, said Alan Wexler, president of Databank Atlanta, which tracks real estate data.
However, he and other experts said its too soon to tell if prices have fallen as low as they are going to.
Well know weve hit the bottom when prices start going up, and that will take a year or so, Wexler said.
While 2010 will be better than 2009, Carter executive vice president Mike Shelly said, "we're not back to the level of activity prior to the downturn."
The first stage of recovery in past downturns has been commercial brokers getting busy, said Wexler.
The difference this time is each sale will take longer to come to fruition," he said. "Limited financing is the primary reason, and some sellers are still being unrealistic about prices.
Despite the flurry of activity, metro Atlanta sales were down in every category, along with the price paid per square foot, or unit for apartment properties, according to LoopNet.
Among its findings:
-- Office sales totaled $370 million, compared with $1.8 billion a year earlier. Price paid per square foot fell 44 percent.
-- Industrial sales totaled $268 million compared with $749 million a year ago. Price paid per square foot fell 30 percent
-- Retail sales totaled $561 million compared with $594 million a year ago. Price paid per square foot fell 32 percent.
-- Multifamily sales totaled $692 million compared with $1.4 billion a year ago. Price paid per unit was down 17 percent.

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