Sir Robert Jones tips shares over ownership hassles

By Chris Hutching

Friday 14th April 2000 1 Comment

SIR ROBERT: Writing a new book - and buying shares in listed property companies

Sir Robert Jones is sold on New Zealand equities at the moment.

He believes they "have never looked so attractive."

He is trying to liquidate his property holdings in favour of buying shares in listed property companies.

Sir Robert has been touring the country in recent days promoting his book Full Circle. Readers who have enjoyed the book, which he is obviously proud of, will be pleased to learn he has another at the gestation phase all about the emergence of mass tourism.

Although he clearly has more time for his writing he is still involved "as banker" in property deals here and mostly in Australia.

He said that with listed companies like Property For Industry trading at significant discounts to asset backing there was little point in putting up with the hassles of direct ownership.

And at the same time, Sir Robert sees a fundamental shift going on in the commercial property market around the world driven by technology. In this country it was exacerbated by population outflow.

Investing institutions had recognised this already with a move to top quality.

Some, such as Prudential in the UK, were even returning to property development but in apartments rather than commercial, he said.

In Sydney, where Sir Robert lives much of the time and has considerable property holdings, he has just bought two office properties near the inner city on Pitt and George Sts for conversion to apartments.

"You've got four million people crammed into Sydney so the demand will always be there. It's the same in Auckland where things are really starting to fizz."

But in the regions and smaller cities such as Christchurch, commercial property rents appeared to be going back to the 1960s and 1970s when $3 a square foot was common, he said.

It would take a period of adjustment for some of the older properties to attain a virtual nil value before builders and developers moved in and converted them for other uses such as apartments.

Even places like Hamilton, regarded as the "golden city" in the 1980s, had seen tenant demand dry up.

"Maybe in a year or so I'll buy one of those old properties somewhere, more for interest's sake and I'll let an architect have full sway. I'd be involved to some degree of course."

Against this background of declining property values and high vacancy rates, Sir Robert said he was astounded at the meanness of spirit that seemed to pervade much of the corporate culture and put it down to a hangover from the past 10 years or so of economic conventional wisdom.

"Why on earth are these managers trying to squeeze people into smaller and smaller spaces when there is oodles of office space everywhere. I don't understand it.

"One thing about RJI (Robt Jones Investments, now Trans Tasman Properties) in the old days was that we provided the best office accommodation.

"The lights were always on till late into the night and it wasn't because anyone was forcing people to be there. It was just a good atmosphere."

Comments from our readers

On 30 March 2011 at 7:54 am Paul said:

Another dose of messiah wisdom, can’t fault the logic although very interesting to advocate share ownership as opposed to the physical stuff for someone in his position, I can’t believe he’d be liquidating to much certainly not the good stuff, and a lot of people have made their little nest eggs on the coat tails of the likes of Buffet and that Jones boy, money wisely spent most likely