: Home Loans | Home Finance | Home Loan News

Rams Home Loans are advertising low loan rates again, after a quiet year for all non bank lenders due to scare mortgage funding due to the global Financial crisis. [the one that Australia largely avoided].

And like many of its securitised cousins it is now controlled by one of the big four banks.

RAMS chose to list after private equity players appeared reluctant to meet its $1 billion takeover asking price, right at the top of the mortgage market.

That would have been the sale of the century as it value was battered with no way of getting funding. But now things are looking rosy for securitised lenders with the banks looking to increase their margins on home lending, as the non bank secture has a tiny 5% market share. So the banks can afford to be thick skinned about criticism of profit gouging, because their is no one in the home loan market who can hurt them in the market.

I have also noticed Rams Home Loans looking for franchises again and that could be a good deal for years to come.

Rick Adlam

Private equity’s global property players have as much as $US300 billion ($359.99 billion) to spend on a “Down Under” shopping spree and giants such as Lend Lease and Multiplex could be the targets, analysts say.

In a report, Merrill Lynch said there could be $US104 billion ($124.80 billion) in the coffers of property private equity firms committed, but not yet spent, for Australian takeover or merger targets.

“Assuming a 65 per cent cent gearing, this can mean almost $US300 billion ($359.99 billion) buying power,” Merrill Lynch said.

The report comes a week after a $4.7 billion bid for property company Investa by the US-based Morgan Stanley Real Estate.

The bid has prompted expectations that strings of other takeover attempts for Australian property groups by offshore giants could be in the wind.

Merrill Lynch said that based on its ratings, Colonial First State’s retail office trust, CFS Retail, was the most vulnerable to takeover or merger.

Next on the list were the two developer giants, Multiplex and Lend Lease.

And this was followed by Deutsche Bank’s RREEF trust, Mirvac, APN/UKA European Retail Trust, and Commonwealth Office.

A Merrill Lynch analyst said factors examined for takeover or merger vulnerability included balance sheet strength, management’s willingness to sell, value of individual assets and strength of cashflows.

Merrill Lynch said an acquisition of retail property giant Westfield Group was unlikely.

“The Lowys (the family that runs and control the business) are well compensated, high-profile managers of one of the largest Australian companies and global real estate investment trusts,” Merrill Lynch said.

“Additionally, the limited buyer universe for US and Australia malls may discourage private equity firms looking to flip assets.”

JP Morgan analysts said in its report that Macquarie Office Fund was “not takeover proof”.

“We think Macquarie Office Fund will either buy out the share owned by the Blackstone Group in a number of joint venture assets or, with Blackstone, dispose assets,” JP Morgan said.

“Buying core assets in quality US markets is now pretty well out of Macquarie Office Fund’s league.” If Macquarie Office Fund was a takeover target, the trust’s keeper, Macquarie Bank, would respond to any suitor in “full force”, JP Morgan said.

“Despite that, a bid cannot be ruled out.”

JP Morgan said the fund faced a risk of dilution of senior management’s knowledge and understanding of local market conditions.

“We don’t necessarily see diversification of exposure globally as reducing portfolio risk.”

JP Morgan’s analysts said they were concerned about Australian listed property trust managers “spreading their global wings”.

JP Morgan said demand for office space in Los Angeles, where the Macquarie Office Fund had assets, was “brisk”, and rents had risen by 9.3 per cent for the year to March 31.

“Rents are spiking and developers are moving quickly to try and profit.”

JP Morgan said Macquarie Countrywide Trust, which has 251 property assets in four countries, was almost “takeover proof” with its move into the US, which was also highly profitable for unitholders.

JP MorgProperty predators ready to pounce – reportBy Bridget Carter
June 05, 2007 02:28pm
Article from: AAPFont size: + -
Send this article: Print Email
PRIVATE equity’s global property players have as much as $US300 billion ($359.99 billion) to spend on a “Down Under” shopping spree and giants such as Lend Lease and Multiplex could be the targets, analysts say.