Stockland boss expected to change tack
The group will also reveal plans to scale back its office and industrial portfolios. After a managament reshuffle last week chief financial officer Tim Foster and head of residential Mark Hunter will leave their positions.
One analyst said the departure of Mr Hunter could signal more pain in the group's residential business in Monday's strategic review.
In the half year results to December 31, 2012, released in February, the group reported a statutory loss of $147 million. The result included $306 million of impairments to asset values, mainly in non-core residential projects that have been identified for sale, and unrealised fair value changes to other assets.
Mr Steinert described the result as "pretty disappointing".
He said at the time that nothing was off limits under his review, which could herald a renewed focus on high-density apartments, less reliance on retirement and mixed-use residential developments, and a revision of the policy to sell commercial and industrial properties.
In the impairments, there were 13 projects identified as more suited to disposal, mainly in Queensland, but also five in NSW including at Warriewood and one at Point Lonsdale, Victoria.
As part of the recent management changes, Stockland has created the new position of group executive strategy and stakeholder relations, and appointed Simon Shakesheff, who will join the company by mid-August.
Current group executive Michael Rosmarin takes up the newly created position of chief operating officer, with responsibilities including human resources, operations, operational risk and marketing.
Mr Steinert said Mr Foster would leave Stockland later this year. He will continue in his role until a successor is appointed.
Goldman Sachs analysts say Mr Steinert's changes are a core part of a restructuring of the business, since transitioning into his new role late in November last year.
In his first outing in February as the new CEO, Mr Steinert put a stop to any more activity in the commercial and industrial divisions pending the outcome of his strategic review.
Market speculation has centred on Stockland dropping the three 'r' focus of residential, retail and retirement, to a two-pronged medium density residential and retail.
That could also encompass Stockland creating a merger or sale with FKP Property for the retirement assets. It is said the two groups have been in discussion over the future of the assets for some time.
Using the term, "centres of excellence" which has been discussed by previous management, Stockland could look at redeveloping its existing land banks to mixed use, medium-density projects. Conversion of older industrial sites to residential is also an option. It is unlikely a return to high-density apartment complexes, such as at Balgowlah, will be contemplated.
Frequently Asked Questions about this Article…
Mark Steinert is expected to outline a strategic review that reverses the group's previous emphasis on residential, retirement and retail. The plans being signalled include a renewed focus on medium‑density residential and retail, and scaling back parts of the office and industrial portfolios. Steinert has said nothing is off limits under his review and he previously halted new commercial and industrial activity pending the outcome of the review.
In the half‑year to 31 December 2012 Stockland reported a statutory loss of $147 million. That result included $306 million of impairments to asset values — mainly non‑core residential projects identified for sale — plus unrealised fair value changes to other assets. CEO Mark Steinert described the result as "pretty disappointing."
As part of the reshuffle, chief financial officer Tim Foster and head of residential Mark Hunter will leave their positions (Mr Foster will remain until a successor is appointed and will leave later in the year). Stockland also created a new group executive strategy and stakeholder relations role and has appointed Simon Shakesheff to join by mid‑August. Current group executive Michael Rosmarin will move into a newly created chief operating officer role.
The impairments included 13 projects identified as more suited to disposal, mainly in Queensland. There were also five projects in New South Wales flagged for disposal, including Warriewood, and one project at Point Lonsdale in Victoria. The impairments were largely tied to non‑core residential projects.
The article reports market speculation that Stockland could create a merger or sale with FKP Property for its retirement assets. It says the two groups have been in discussion over the future of those assets, but this is presented as market talk rather than a confirmed transaction.
Yes. The company has discussed "centres of excellence" and could look at redeveloping existing land banks into mixed‑use, medium‑density projects. Conversion of older industrial sites into residential is also mentioned as an option. The article notes a return to high‑density apartment complexes (for example Balgowlah) is unlikely.
Goldman Sachs analysts view Mr Steinert's management changes as a core part of a broader restructuring since he moved into the CEO role late in November. The changes, including executive departures and new roles, are being interpreted as part of repositioning the business.
Investors should watch the formal strategic review outcomes and any announcements about the composition of the portfolio (for example scaling back office and industrial assets), confirmed plans for residential or retirement assets, details of any disposals or mergers, and the appointment of successors for key roles such as CFO. Also monitor updates on impaired or for‑sale projects and any changes to development focus such as medium‑density or mixed‑use projects.
Call 1300 880 160
Start a chat
Schedule a call
