Monday 20 November 2017

TH€ PUNT: Commercial property market must be built on transparency

THE Punt is all for transparency. PLCs have to comply with stock market rules, which at least require firms to post their full earnings every six months.

Alas, the property market has few such requirements.

The key to a functioning market is pricing data. How much is a premises selling for? Not, how much was it listed for sale at?

On the residential side, a property price register was resisted for years. While people loved to brag about how much they had flipped their houses for during the boom, we never knew the real prices and that helped skew the market. Since the register went live last year, analysts have been universal in their praise of it.

Alas, there is still no equivalent for the commercial sector, and it is not in any agent's interest to highlight how little they got when they sold a shop or office block.

That lack of transparency is a barrier to a working market, and it's a barrier to people trying to do research on the market.

Yesterday, Goodbody's chief economist Dermot O'Leary highlighted the "lack of transparency" in the commercial property sector as a potential barrier to recovery.

International investors who are driving the recovery in the commercial space are a canny sort. Commercial property prices plunged by 67pc from peak to trough, leaving plenty of low-hanging fruit that required little research. Now, though, as those are taken up, investors will want more data before they spend their money – and that data is not widely available. A price register for commercial property can't come soon enough.

 

Council destruction is medieval

"Each man kills the thing he loves," wrote Wilde, but the same sentiments often apply to county councils.

One council that wastes few opportunities to do just that is Kilkenny, which is, of course, home to Environment Minister Phil Hogan.

The council is planning to demolish a medieval house close to the beautiful St Canice's Cathedral, because it stands in the way of a road that the council is determined to build through the town centre.

This particular piece of cultural vandalism is opposed by the usual suspects such as An Taisce, but also up to 1,000 locals who marched through the city last week to voice their concerns about the Central Access Scheme.

The council is determined to destroy this part of town, called Irishtown, and finish the work of their predecessors who had already made great strides in that direction. The Punt wonders whether Diageo, which has generously donated the grounds of the once thriving brewery to the council, will live to regret the decision? That fine gesture deserves more credit that the company has received, but it is akin to giving a teenager a six-pack and the keys to your car – disaster is a distinct possibility.

 

Name game can pay dividends

United Drug, the healthcare company headed by Liam FitzGerald (pictured), has at last got around to changing its name.

The change is part of the company's efforts to more accurately reflect its wider business, which encapsulates a heavy emphasis on contract sales and marketing as well as drug packaging and distribution.

Now known as UDG Healthcare, the change also follows the firm's move from a stockmarket listing in Dublin to London a year ago.

Since the listing move, shares in the company have climbed by almost 50pc, valuing the business at close to £780m (€929.8m).

So The Punt got to thinking about how firms that change their names perform subsequently. While the Google domain name was registered 15 years ago this month, it had originally been called 'BackRub'. It doesn't quite have the same ring to it. And look at Google now.

The Punt can't imagine anyone saying that they've been "back-rubbed".

Irish Independent

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