Saturday, 12 September 2009

Mountgrange Greed knows no bounds

Full Article here in Reuters

from article -

'LONDON (Reuters) - Fund manager Mountgrange spies more money-spinning opportunities in the housing market than in commercial property, where prices are rallying fast under the glare of the world's wealthiest bargain hunters.

Nick Berry, a partner at the privately owned fund manager, said sheer weight of money chasing discounted UK offices and shops was inflating values quicker than the fundamentals alone would support, pushing the firm to consider alternatives.

"There's a stronger case for optimism in the residential sector at the moment. There is an overwhelming shortage of housing, in particular affordable housing so demand is easily identified," Berry told Reuters.

"Available commercial property stock is much less abundant and when you're thinking about where demand is coming from in that sector, it's not so obvious. Unemployment is rising and that is pushing up vacancy rates too," he said.

Berry said the appeal of the residential sector was underpinned by lower construction costs and cheaper land prices, as well as a willingness on the part of some UK banks to take action on their problematic residential assets.'

Mountgrange, which was set up by veteran property entrepreneurs Martin Myers and Manish Chande, made its last acquisition in August 2008 when it bought a portfolio of retail and office properties from PRUPIM for 140 million pounds.

Berry said Mountgrange's investors -- a mix of sovereign wealth funds, European and North American fund of funds and state pension investors -- have been supportive of a decision to remain on the sidelines and placed no pressure on them to rush back into the UK property market.

"I'd say that whilst rents continue to fall and it is unclear where new occupier demand is coming from, it is difficult to argue that funds who have adopted this approach are in danger of missing out," he said.

This is the same Mountgrange (another one of the companies now in administration) that owes £18,000 n rent to the City of Edinburgh Council for the rent on the council tenancies they had cleared to make way for a 5 star hotel and luxury housing.....and owes HBOS £70million smackeroonies see BBC piece here

You couldn't make it up. Have these people no shame?