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Pallas pads out inner-city headquarters


During the pandemic, Pallas Capital has banked $22.75 million for projects in Richmond and Chadstone.

The site for Pallas House Melbourne, at 67-69 Palmerston Crescent, was purchased last summer for $8.6 million. Construction is set to start on the nine-storey building in September.

To date, leasing deals worth $550,000 have been committed for the 3200 sq m of space, mostly from a cluster of finance outfits and property businesses.

The Double Bay office at 30-36 Bay Street is undergoing a $15 million upgrade which is expected to be completed early-2021. Leasing commitments worth $1.8m have been struck there.

Bottlemart

Caydon has offloaded another of the new shops at its Mason Square development, the $700 million project it built on the old Moonee Ponds market.

40 Hall Street shop fetched $1,025,000.

40 Hall Street shop fetched $1,025,000.Credit:

The 40 Hall Street shop fetched $1,025,000 and was sold to a Darwin-based investor putting money into commercial property for the first time.

The deal, reflecting a yield around 5 per cent, comes as the massive 1100 unit project gets close to completion.

The shop is leased to a Bottlemart bottle shop, an almost recession and pandemic-proof retailing category.

Only one space remains available along the Hall Street precinct.

CBRE’s Jason Orenbuch, Rorey James and Nic Hage handled the transaction.

Mr Hage said “The property was offered to the market before COVID-19 restrictions and initially intended for auction. The restrictions forced a change in tack, at which point the property was repositioned and a ‘private sale’ process commenced.”

North-east of the city on the corner of Bell Street and Upper Heidelberg Road, Mr Orenbuch and Zelman Ainsworth have leased a 186 sq m space to a cafe in Caydon’s imposing 248-unit Ivanhoe Apartments at $45,000 a year.

Mr Orenbuch said there has been high demand for operators wanting to be close to the Austin Hospital and the surrounding medical precinct.

Knight Frank agents Matthew Romanin and Nick Bisset are also selling a large 822 sq m office in the 443 Upper Heidelberg Road development which is expected to fetch around $5.5 million.

The ground floor office is leased to The Institute for Social Neuroscience Psychology College for 10 years, returning $358,817 a year in rent.

Auto shop

Meanwhile just a bit further up the road at 537 Upper Heidelberg Road, Heidelberg Mitsubishi is on the move, poised to leave a large 5606 sq m parcel of land vacant.

Mitsubishi is on the move from 537 Upper Heidelberg Road, Heidelberg.

Mitsubishi is on the move from 537 Upper Heidelberg Road, Heidelberg.Credit:

NSL Property Group’s Guy Naselli has the listing. The property, which has 174 metres frontage opposite Heidelberg Cemetery, includes a 2586 sq m building.

Mr Naselli said there have been enquiries from leading automotive brands, but the closeness to the Austin Hospital lends it to potential medical related uses.

He even flagged the potential for a hospitality group to make use of the big site.

The car yard site was bought nearly 20 years ago by REIL Dealership Bonds, an entity associated with Sydney-based accountants group Bentleys.

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Braybrook convent makes way for school’s performing arts centre


The orange brick structure formerly on this site was also riddled with structural issues, and was reaching the end of its lifespan.

Although this building was transformed to rubble, there were a number of strong architectural features that resonated with the architects of the practice, Brad Wray and co-director Nick Russo.

“Nick and I loved the dome above the altar as well as the layering of the exterior brickwork. There was also something quite charming about the three-dimensional relief work on the interior walls,” says Wray, who replaced the ’60s buildings with a brand new wing.

Constructed in concrete and glass, with massive steel girders, the new arts complex is orientated to a courtyard garden, designed by landscape architects Orchard Design in the footprint of the former complex.

As well as the many highlights in the former building, Branch Studio Architecture was initially inspired by the foyer in the Victorian College of the Arts’ performing arts centre at Southbank, designed by Peter Corrigan and Maggie Edmond.

“There was a performance by ballet dancers in the foyer, aligned on the vibrant blue floor,” says Wray, who recalls the image of these dancers as he traversed the wrap-around staircase and viewed this perspective from above.

The Arts Epicentre doesn’t come with a blue floor, but there is a circular arrangement to the way this performing arts space is used: a concrete staircase with a steel mesh curtain acting as a “veil” on one side, and a black steel curved staircase on the other side of the space.

“The idea is that you can circle the main performance space, with the silhouette of people going to the first floor, creating a theatrical backdrop,” says Wray, who also conceived the spiral staircase to include a balcony for the performers.

The outdoor area also becomes an important part of the stage, with one continuous automated glass and steel door bridging the indoors and outdoors.

Hence, the airport-style door that folds in on itself required substantial steel girders for support.

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“We were drawn to the industrial aesthetic, a feature of many of the industrial pockets that surround the school,” says Wray.

Pivotal to the design are five skylights that pierce the plywood ceiling, creating lightwells, as well as adding a sense of drama to the centre.

Set within the six-metre-high void, these steel-framed plywood-lined skylights are truly works of art in their own right.

Again, while not obvious for those who didn’t enter the former building, there’s the memory of the umbrella-shaped relief that once graced the walls.

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Branch Studio Architecture also brought the memory of Corrigan and Edmond’s colourful interior on this journey, with the series of adjacent change rooms created in strident blocks of vibrant colour, including blue.

While the performing arts space has a theatrical feel, the individual music and art studios on the first floor are more restrained, but as equally considered.

A sense of joy is also beautifully expressed on the building’s exterior, in particular the west and south elevations.

The perforated laser-cut steel screens, supported by concrete bands on either side, took their cue from the pianola script of Singing in the Rain (a memorable dance scene featuring actor Gene Kelly).

“You wouldn’t necessarily pick up this detail, but the screens certainly diffuse the light and add to the theatricality of the centre,” adds Wray.

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Centuria Capital on track for full takeover of Augusta


Centuria Capital has boosted its international platform, with its $122 million takeover offer for Augusta Capital going unconditional after it secured 65.86 per cent of the New Zealand property company’s shares late on Wednesday.

The deal now sees Centuria on track for a full takeover of Augusta, which, if completed, will increase Centuria’s assets under management by 24 per cent to $8.9 billion.

Joint Centuria Capital CEO John McBain.

Joint Centuria Capital CEO John McBain.Credit:

Joint Centuria CEO John McBain said he was “delighted” to report close to two-thirds of Augusta shares have been secured within eight business days of the takeover offer commencing.

“We are encouraged by the significant response and look forward to the offer completing, which will expand our funds management platform into the New Zealand market,” he said.



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Society needs a 'new abnormal': time to shake up the social contract



Passionately held opinions should not be a replacement for considered ideas and debate.



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the delight and impact of teaching


How long have you been doing this job and what first sparked your interest in this area?

I have been teaching for 21 years but this is my first year in Australia, having taught in the UK, UAE and Qatar.

My interest was sparked by realising that teaching science combines my greatest passions, learning/teaching science and helping the next generation. I wasn’t 100 per cent convinced when I started my post-graduate teacher training but having Nelson Mandela visit my practice school in Holland Park (Central London) not long after his release from prison in South Africa made me realise how important schools and teachers were and what an amazing impact they can have on society.

What do you like most about your job?

The everyday interactions are like ‘ordinary magic’. I learn something new every day and enjoy most of my daily interactions. Kids are never boring. Having had the opportunity to travel the world as I work is a great perk too.

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What was the most unexpected thing you have had to do in your job?

Reserve VIP seats during a school play.

What is the worst thing you have had to do?

Give bad news of any sort, it’s never easy.

How transferable are your skills?

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Very. Teaching requires adaptability – it means a teacher can wear so many hats.

What advice do you have for people wanting to get into this career?

Go for it. The start can be tricky but if you hang in there and find the right environment for you, you’ll love it.

What personal skills do they need?

Flexibility, empathy, resilience and perseverance.

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Tablet interactive: Coronavirus outbreak


The coronavirus pandemic is proving to be one of the toughest challenges of our generation. Visit our special coronavirus homepage to find important news updates, a link to our coronavirus newsletter, clear, useful information and tips for your wellbeing through this emergency.

Tap below to follow our daily live blog.



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Cheap money not enough to cure our economic ills


The answer is that although few people were willing to commit to a new mortgage during the lock-down period of May, hordes of people who already had loans, perhaps feeling nervous, rushed to switch banks as lenders slashed their fixed rates to as low as 2.19 per cent.

That refinancing bonanza is in part a result of the Reserve Bank of Australia’s extraordinary effort to drive down the cost of borrowing in March, through the cash rate cut and a range of other “unconventional” measures. While housing is not the economy, of course, it is an important channel through which lower borrowing costs flow into the economy.

This week’s wave of refinancing demonstrates that cheaper credit is indeed flowing: home owners are saving on interest as a result of cut-price interest rates, allowing them to spend more, or pay off debt more quickly.

However, the weakness in new mortgage lending also illustrates how rate cuts alone can’t offset the far bigger problems hanging over the economy, such as job uncertainty. And that reflects a wider limitation of slashing interest rates to support an economy: the RBA can free up household cash flow, but cannot make people lift their spending (or force businesses to invest). And that’s really what the economy needs right now: demand.

Which is why economists are so keen to see Treasurer Josh Frydenberg use the federal budget to support the economy in its hour of need when he delivers a key update in just under two weeks.

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First, however, back to all the cheap money that’s sloshing around the financial system and finding its way into household bank accounts. The surge in mortgage refinancing activity is a tangible illustration of how the RBA’s foray into “unconventional” monetary policy has flowed into the “real” economy of household budgets.

As a refresher, back in March the RBA not only cut official interest rates to 0.25 per cent but also unveiled measures to force down bond yields and give banks up to $90 billion in loans at an interest rate of 0.25 per cent. Banks have also been awash with deposits in recent months as nervous households ploughed $40 billion into their bank accounts, and super funds held cash on hand to prepare for emergency withdrawals.

As explained by deputy governor Guy Debelle in a speech last week, the overall effect of the RBA’s various measures has been to bring down the cost of funding for the banking system. The fall in funding costs has been greater than the 0.25 percentage point in the cash rate announced in March. The bank bill swap rate – a gauge of the cost of banks lending to each other – has fallen to just 0.1 per cent.

What are banks doing with the windfall from cheaper funding? Some of it might support their profit margins, but it appears a lot is being passed on to borrowers in the form of low interest rates for new customers, or those who haggle or refinance.

This is reflected in RBA figures that show the average rates on new home loans continuing to fall in recent months to 2.73 per cent and 4 per cent for small business. One small Tasmanian bank is even offering fixed rate mortgages at interest rates of less than 2 per cent.

Given the extent of the economic hit from COVID-19, financial markets are betting that extremely low interest rates are probably here to stay for years to come.

As governor Philip Lowe said after this week’s board meeting, the cash rate will not increase until there is progress being made towards full employment and inflation running sustainably within its 2 per cent to 3 per cent target band. Debelle in his speech said this was “likely to be some years away”.

The challenge, however, is that with a cash rate of just 0.25 per cent, monetary policy is getting closer to the limits of what it can be expected to achieve. The RBA hasn’t exhausted all its options, as a quick look around the world of central banking reveals. Some believe the RBA may act to try to bring down the Australian dollar if it climbs too much higher, and there’s always negative interest rates (though Lowe has said this is “extraordinarily unlikely”.)

But the interest rates lever has been well and truly pulled. The financial system has a huge amount of funding at its disposal, at very low cost, but what the economy needs is stronger demand. Given the uncertainty about future employment and the real worry of a second wave, economists say this requires an ongoing role for the other big arm of economic management: fiscal policy.

Frydenberg has made it clear there will be some further fiscal support in his upcoming economic statement, which might include JobKeeper being extended in some way, or tax cuts being brought forward. With the government’s surplus ambitions long ago blown out of the water, it’s time for fiscal policy to step up to the plate.

Ross Gittins is on leave.

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Wall Street is getting nervous about the idea of President Biden


Of course, no one can ever be entirely sure what moves a market. But stocks of some military companies have also underperformed, reflecting a view among some investors that a Biden victory could depress weapons sales.

And Wall Street analysts, who provide market research to hedge funds, asset managers and other big investors, say those clients are increasingly seeking their advice on the impact of a Biden presidency, especially on taxes.

The market is starting to worry that Trump will not be re-elected. Trump is consistently viewed as a positive for the stock market.

Lori Calvasina, head of US equity strategy at RBC Capital Markets

Recently, inquiries from investors about Biden’s lead in the polls have focused almost exclusively on the issue of taxes, said Jonathan Golub, chief US equity strategist at Credit Suisse. “That’s, right now, kind of the market’s focus,” he said.

On June 29, Biden, the presumptive Democratic nominee, told potential donors at a virtual fundraiser attended by Wall Street people that he would roll back most of Trump’s $US2 trillion ($2.9 trillion) tax cut, “and a lot of you may not like that.”

Additionally, public opinion has swung in a way that indicates that Democrats, who control the House of Representatives, have a stronger chance of re-taking the Senate come November. Such unified control could mean a sudden shift away from a range of policies — like corporate tax cuts, deregulation and weapons sales to foreign governments — that have helped push up stock prices in recent years.

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“The market is starting to worry that Trump will not be re-elected,” said Lori Calvasina, head of US equity strategy at RBC Capital Markets. “Trump is consistently viewed as a positive for the stock market.”

Stockmarket investors have done well under Trump. The S&P 500 is up more than 45 per cent since his election on November 8, 2016, despite periods of sharp volatility, including one in recent months as the pandemic led to an enormous market sell-off, followed by a robust return on the back of giant helpings of government stimulus.

It wasn’t always this way. The shock of Trump’s election jolted investors at first. After his victory, stock market futures plunged more than 5 per cent in overnight trading. But investors didn’t take long to adjust to the prospect of unified Republican control of the federal government, which lasted until the 2018 midterm elections and introduced a number of deregulatory and tax policies deemed favourable to the markets.

Now, stock market analysts and investors are trying to figure out which of those policies could come to an end if Biden goes to the White House. Among Biden’s policy proposals are a partial reversal of the Trump administration tax cuts signed into law in late 2017. Those cuts, for both individuals and businesses, were some of the most sweeping changes to the tax code in decades.

In particular, the Trump tax cuts were a windfall for major American corporations, helping to drive up the profitability of companies in the S&P 500 more than 20 per cent in 2018. While the Trump administration promoted the tax cuts as a way to increase incentives for companies to invest and drive wage gains, many companies used their savings to buy back their shares — increasing the wealth of their shareholders by billions of dollars in the process.

At last month’s fundraiser, Biden detailed his plans, which include raising the corporate tax rate to 28 per cent from 21 per cent, according to a pool report.

A recent analysis of Biden’s tax plan from Goldman Sachs suggested that if enacted, his corporate tax increase would cut the earnings per share of S&P 500 companies about 12 per cent, a prospect that could act as a headwind for stocks.

“It’s becoming a hotter topic the more the polls come out showing that Biden is in the lead,” said Tony Dwyer, chief market strategist with the brokerage firm Canaccord Genuity in New York. “The more that Biden is up, the more that people are going to start to think about what that means for taxes.”

Despite periods of extreme volatility, the S&P 500 is up 45 per cent since Trump was elected.

Despite periods of extreme volatility, the S&P 500 is up 45 per cent since Trump was elected. Credit:AP

The stocks of military companies, which are viewed as beneficiaries of the Trump administration’s push to sell weapons to Saudi Arabia, have lagged the market as Biden’s fortunes have risen in polls.

“We see higher risk around weapons sales to the Middle East, and especially Saudi Arabia, in a Biden administration,” military stock analysts at JPMorgan Chase wrote in a recent note to clients.

Investors in the oil and gas industry have also raised questions with analysts about what a change in the White House would mean for energy companies, from access to federal lands for drilling to increased carbon regulation of refiners. In a research report issued late last month, Goldman Sachs analysts noted that many of their conversations with investors focused on the risks to oil and gas companies in the event of a Democratic victory in November.

Still, industries such as health care and technology, which were some of the biggest beneficiaries of the Trump tax cuts, don’t appear to be drastically underperforming the market.

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Some analysts have noted that a Biden presidency could be a source of stability for the markets, which have been hammered at times during Trump’s tenure. Since 2018, his on-again, off-again trade, tariff and technology war with China has generated waves of volatility for stocks.

“A Biden presidency would result in less trade tension with China, which would be a welcome relief for equity investors,” economists at BCA Research wrote. They also noted that corporate tax increases could finance government spending that would stimulate the economy, a potential plus when the post-pandemic recovery looks slow and long.

The New York Times

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Crime curiosity led to following her passions


“I’m pretty sure I was the only eight-year-old in my neighbourhood with their own magnifying glass and dusting kit.”

In 1996, the opportunity to apply for a researcher’s position for the program Australia’s Most Wanted in Sydney came up and Justine threw her hat into the ring. Her early interest in mysteries and crime proved fortuitous: she nailed the job.

After a few months, she was asked if she wanted to be a reporter on the show.

“So I was researching, reporting and producing stories on unsolved crimes all around Australia,” she said.

“I realised at that time just how much the media could help as an investigative tool for police, and could give a voice to the families of victims.

“So I saw a really incredible, proactive role for the media and I thought, ‘I can do something here. I can make a difference’.”

TV crime reporter Justine Ford studied at Charles Sturt University.

TV crime reporter Justine Ford studied at Charles Sturt University.

Ford is the author of five true crime books and has worked on some of Australian docu-series programs including RPA and Border Security as well as Missing Persons Unit.

Charles Sturt University senior journalism lecturer Jock Cheetham said reporting on crime could be tricky because it was subject to laws, including contempt of court.

“A knowledge of the laws of contempt of court and suppression orders and a range of legal restrictions on both the media and the public is required,” he said.

“You need to be sensitive to victims and their families. You need to be fair and acknowledge and work within the constraints of the presumption of innocence. Yet you also need to be a bit tough and direct and call the situation for what it is.”

Between 2017 and 2018, Ford’s production company Queenpin produced The Good Cop for Foxtel on Australian homicide detective Ron Iddles, based on a book Ford has written. It won a Logie for most outstanding factual or documentary program in 2019. Ford also produced The Good Cop podcast, a hit on iTunes.

“Forty-odd years in the police force, 25 in homicide and with a clearance rate of more than 95 per cent. It is unheard of,” Ford said of now-retired Iddles.

Ford has covered crimes including the murder of Jane Thurgood-Dove, the Sunshine Coast disappearance of Daniel Morcombe and the murder of beauty queen Bronwynne Richardson in Albury.

Ford’s time at Charles Sturt University gave her the grounding she needed to launch her career.

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“It’s had such a lasting impact on my life,” she said. “I’ve been able to achieve what I have because I studied there. You could learn everything you needed to springboard you into the profession you wanted to be part of.”

Justine’s advice if you want to be a producer or journalist:

I’d say to anyone thinking about a career as a journalist or a producer: make sure it is really your passion. Because in an ever-changing media landscape, it is an unstable profession and many people are out of work.

Also make sure you’re not faint-hearted, that you’re skilled at perseverance and can stick to deadlines. You have to be on your game all the time because there’s always someone with an eye on your job or willing to steal your ideas!

Consider doing the producer course at CSU. I’ve seen fantastic producers come out of there and they have multiple skills. They have a strong storytelling base, but they can also use cameras and they can edit. It makes them among some of the better producers in NSW.

  • Consider doing something else as well.

If your heart is set on a media career, I wish you every success! But consider getting another qualification too. Can you study PR as well? What about marketing? Or law? Because if you can “value-add” to your knowledge, you are more likely to have something interesting to fall back on if times get tough.

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Virgin bondholders claim Deloitte reneged on sale process


The bondholders have asked the Takeovers Panel to intervene so creditors can vote on their proposal at the second meeting of creditors in August, and launched court action this week to try to unseal the secret details of the Bain deal to inform their rival proposal.

Broad Peak’s submissions lodged with the Federal Court on Thursday afternoon – which revealed for the first time that it and Tor own $300 million of Virgin’s bonds – slam Deloitte for appearing to withhold from the court that bondholders wanted the deal documents when it requested a confidentiality order over them.

Obtaining the suppression order after “apparently withholding facts directly relevant to the court’s assessment”, only to then use that order to deny the Broad Peak access to information it needs to propose an alternative deal for Virgin “cannot be consistent with the interests of justice”, the submissions says.

Deloitte administrator Vaughan Strawbridge hit back at the bondholders’ court request, saying in an affidavit that if the court supported the bondholders’ claim it could lead to them shutting down the airline, possibly creating a worse outcome for creditors and putting Virgin’s workforce at risk.

However, Broad Peak’s submissions says that a June 19 Virgin cash flow statement disputes Deloitte’s claims that Virgin would have gone into liquidation if it had not have executed the snap sale to Bain.

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Broad Peak also claims it developed its proposal for Virgin after Deloitte had told it on June 8 it would give “feedback on all offers to enable the applicants to prepare a better offer”, and that while preferring a binding deal, would also consider any offer that delivered a better return to all creditors.

Deloitte changed its tune on June 20, Broad Peak claims, by telling Broad Peak it would not give feedback on its proposal. And on June 23, it told the bondholders for the first time they had to submit an unconditional proposal supported with an upfront payment of $625 million.

Broad Peak also says that Deloitte chose to sell Virgin’s assets to Bain before the second creditors’ meeting despite there being sufficient cash on hand to keep its lights on until that meeting, and did so without going to court to confirm it was appropriate, as an administrator would typically do.

Deloitte was aware, and has told the bondholders, that the Sale and Implementation Deed signed with Bain had the effect of blocking bondholders from putting their offer to creditors at the second creditors’ meeting, “in contravention of their statutory rights as creditors”.



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