Property Finance and Tax, Cromwell Property Group

In: Business and Management

Submitted By eshay
Words 4109
Pages 17
Property Finance and Tax
Assignment 1

Cromwell Property Group

Table of Contents 2.0 Introduction 3 3.0 Background of company 4 3.1 Cromwell Property Securities limited 4 3.2 Cromwell Property Services Pty Ltd 4 4.0 Current Quantitative Considerations 5 5.0 Cromwell Position Prior to Global Financial Crisis 6 6.0 2007 Overview 7 7.0 2008 Overview 8 8.0 2009 10 9.0 2010 11 10.0 2011 12 10.1 Hedging 12 11.0 Cromwell’s financial position post GFC 13 End of 2010 figures 13 End of 2007 figures 13 12.0 Comparison to Mirvac Group and Stockland Corp 14 13.0 Conclusion 14 14.0 References 15

Introduction

Before the 2007 global financial crisis Australia had a strong property market, the decade of 1999 to 2009 produced a 9.4% (national) average increase in median property values, at this rate, properties doubled in value in less than eight years. Once the affects of 2008 had settled in, a 3.8% decline was apparent in median values. However due to stimulus spending and a historically low interest rates there was a quick rebound. The property market was generally flat for the rest of the year. Continuing to a decline in 2011 with undervalued stocks. This was considered a buyers market, this has been taken advantaged of by a listed property company called Cromwell Property Group.

The GFC had resulted in listed companies losing substantial amounts of capital, Cromwell Group was affected however not as bad as other companies. This report will review Cromwell’s performance over the past five years. This resulting in the analysis of actions taken by the company in reaction to the volatile market from the GFC. The report will cover issues in the:

1. Affect of the GFC from 2007 to 2011 2. Company’s financial position and business strategy prior to the GFC and post GFC. 3. Changes to gearing 4.…...

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