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(Corrects to identify Ascendas Pte in third paragraph.)

June 25 (Bloomberg) -- Mirvac Group, which recently raised more than A$300 million ($301 million) from the sale of its hotel management business, will delay any share buyback until market uncertainty stemming from Europe’s debt crisis abates.

“It doesn’t take much to put a credit freeze through the world if Europe, and particularly Greece, doesn’t sort out its issues,” Nick Collishaw, managing director of Mirvac, said in an interview in Sydney on June 22. “We’re holding more cash than we would ordinarily in more stable times. If the board and I see overall market sentiment picking up and we don’t have uses for the capital, then a buyback is on the cards.”

Mirvac in May completed the sale of its hotels unit to Accor Asia Pacific and Ascendas Pte for about A$322 million to simplify its business. The group is now focusing on office and retail properties in its investment unit, which makes up 80 percent of its business, while its development division is concentrating on creating condos, housing communities and commercial properties, Collishaw said.

Mirvac needs about A$200 million from asset sales to fund capital expenditure, Collishaw said at the group’s first-half earnings teleconference on Feb. 21. Above that, the group makes a “serious commitment” to a buyback, taking into account economic conditions, its share price and other opportunities, he said at the time.

As housing markets in Sydney, Brisbane and Melbourne slow, Mirvac is looking to mining areas in Queensland and Western Australia states for future growth. The company is in early stages of talks with coal and liquefied natural gas producers and government bodies in northern Queensland, Collishaw said.

Karratha Project

The talks, about housing the construction workers for plants and pipelines being built, will be followed in about three to five years by discussions about longer-term, master-planned communities, he said.

In Western Australia, Mirvac was named the preferred developer of the city center of Karratha, the biggest town in the iron-ore rich Pilbara region, in November in a joint venture with the local land authority. The A$1.5 billion project, which will create a new suburb, Mulataga, will accommodate as many as 8,000 people, Collishaw said.

“What’s been happening in the Pilbara and north of Queensland so far has been one off, ad hoc projects,” he said. “The debate going on right now in the resource centers and councils is this is no longer boom-bust style development. We’re now putting together the infrastructure, the cultural facilities, you expect to see in the suburb of a city.”

Population Growth

The population of Western Australia jumped 14.3 percent in the five years to 2011, while Queensland’s rose 11 percent, Census figures released last week showed. The median individual income surged 32.4 percent in Western Australia and 23.3 percent in Queensland, they showed.

Mirvac has also entered Perth’s office market, with the redevelopment of the Old Treasury Building, which is fully leased to the Western Australian government for 25 years, he said.

Perth had a vacancy rate of 3.3 percent at the end of December, as the city saw its third-highest absorption on record, driven by an unemployment rate of 4.3 percent, according to figures from broker Colliers International. In contrast, Sydney’s vacancy rate was 9.6 percent, and Melbourne’s 5.3 percent.

To contact the reporter on this story: Nichola Saminather in Sydney at

To contact the editor responsible for this story: Nichola Saminather at

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