Fund update The fund settled its final apartment sale at One East Melbourne on 23 April 2010. The defects liability periods for the Treasury Residences and One East Melbourne Office Building expired on 6 July 2010 and 30 July 2010 respectively. Other than a small payment for unfinished work to be completed by January 2011, the builder has now been paid in full. Becton Office Fund requested an extension until January 2011 for the payment of the balance owed for the sale of the One East Melbourne office building whilst it renegotiates finance and addresses its capital structure. The fund’s auditors determined that it was appropriate to impair the outstanding monies owed by the Becton Office Fund given the position of that fund. The impairment of $0.0584 per unit is reflected in the net tangible assets (NTA) in the table above.

The legal proceeding in respect of the dispute about two parking spaces at Capital Hill remains unresolved. The parties are working through procedural steps. The matter is expected to next go before the court in the first quarter of the 2011 calendar year, at which time a hearing date is likely to be set. The hearing is unlikely to be listed for hearing prior to 2012.

Distributions and redemption

The fund paid a 41 cents per unit return of capital to investors in December 2009, 26 cents per unit in February 2010 and a further 4 cents per unit in July 2010. The amount of the final return of capital to investors will depend on the collection of monies owed to the fund. The final capital payment is estimated to be in the range of one to seven cents resulting in a final return of between 72 and 78 cents. The fund will be wound up upon the full receipt of all monies owed and payment of all liabilities.

Debt

The fund has no debt.

Sale of Funds Management business

On 6 October 2010, Becton announced the sale of its Funds Management business to 360 Capital Group. We are working on obtaining all the necessary approvals and settling the sale before the end of the calendar year. The sale is the culmination of more than two years’ work to achieve a longer term capital management solution for the funds. It will provide the funds with the backing of a debt-free specialist property funds manager which in turn will provide the funds with enhanced prospects of attracting capital where needed. For further information about the sale please refer to the CEO’s letter in this edition of Review and to the FAQs on the Becton Investment Management website: www.bim.com.au.

 

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