20 Nov 2015

Precinct Properties sees risks in rising construction costs

12:24 pm on 20 November 2015

Property developer Precinct Properties says it is well placed to increase returns to shareholders, but says its margins are under pressure from rising construction costs.

The company told the annual meeting in Auckland this morning it was confident that its large developments along Auckland's waterfront, and the Bowen Campus in Wellington, would deliver on expectations, as economic conditions were generally positive.

However, Precinct chief executive Scott Pritchard said he expected rising construction costs to come into play at some point, with many large-scale developments competing for skilled labour in Auckland.

Meanwhile, Precinct Properties' resolution to raise the directors' fee pool by 29 percent to $580,000 did not raise a single question at the annual meeting, and was easily carried.

Other companies have recently received a strong negative reaction over proposed directors' fee increases - notably Mighty River Power and Sky Network Television.