Corporations increasingly are outsourcing property and facility management of major assets or portfolios to gain access to world class technology and skills, as well as to reduce operating costs and management time required for these activities.

Pressures to reduce overhead and administrative costs have led to outsourcing of lease administration, property tax compliance, lease order and other support functions to companies with strengths in these areas.

Ernst & Young Real Estate Group is currently managing their request for tender on the world's largest property services outsourcing contract, the $3 billion ($AD) Australian Government global portfolio. 

151 Queen St

The AMP NZ Office Trust recently announced that it had leased a further three floors of NZI House (formerly 151 Queen Street) out to 2008, improving the weighted average lease term of the building. The tenant is insurance broking giant, Marsh, following a competitive tender process.

The award wining building, nicked named "Big Pinky" because of its distinctive colouring and striking architecture, is recognised as one of the country's top buildings. It is one of six premium properties in the AMP NZ Office Trust portfolio of commercial CBD properties in Auckland and Wellington. The lease is for nine years, concluding on 30 June 2008, for levels 18, 19 and 20.

REITs (Real Estate Investment Trusts) will continue to grow through acquisitions.

With the decline in REIT share prices last year, their costs of raising capital have increased. As a result, REITs are buying fewer properties, and some have pulled out of the market altogether.

Despite the current slow-down in buying activity, REITs will have strong long-term growth through the acquisitions of portfolios of assets or single properties, as well as through mergers with other REITs. Because they own only about 7% of the total value of commercial real estate in the United States, they can continue to grow and increase their market share through acquisitions. According to the National Association of Real Estate Investment Trusts, REITs raised $32.7 billion in initial public offerings and secondary offerings in 1997, nearly a three-fold increase from the $12.3 billion raised in 1996.

Forecasts vary but, REITs total market capitalisation could increase to as much as $1 trillion within five years from about $149 billion currently

Lend-Lease has confirmed that it's having discussions with United States investment trust Equity Office Properties over possible property purchases. It relates to a new Australian Property Trust to invest in United States Office assets.

Lend-Lease boosted its global presence with the $NZ918.76 million purchase of British construction-and-management company Bovis Group. Equity Office Properties is owned by United States financier Sam Zell and has a market capitalisation of $NZ 27.29 billion. It controls 285 office properties across the United States and was ranked as the country's largest office trust.