Case Study: ANZ National Bank
Managing lease portfolio costs & risks
ANZ is an iconic New Zealand bank which claims to touch the lives of almost every Kiwi. With nearly 1 in 2 New Zealanders having a banking relationship with them, that claim isn’t too hard to believe. With a long-established history, there have been many significant milestones over the years which have led to the reputation and size of their brand. 2003 saw ANZ merge with National Bank where they had a combined network of over 300 branches and 500 ATMs, making it one of the largest corporate property portfolios in NZ.
As property costs are generally the third largest cost behind staff and technology, Marcus was employed by ANZ National Bank to improve management of its property costs. Marcus managed both the Bank’s internal property team and its combined branch and ATM portfolio. The key issues that needed addressing were accurate budgeting of property costs, ongoing property cost management, and the timely management of lease issues and renewals.
Getting stuck into the fine details of the lease portfolio and its financial situation, Marcus and the team conducted a lease audit, reviewed and corrected key lease data, built reporting dashboards, and designed and implemented a new lease budgeting process.
As such, Marcus devised a portfolio management strategy to ensure:
- Proactive property cost management via annual bottom up lease budgeting and annual opex reviews and reconciliations
- Proactive tenure management via lease extensions to secure and protect future tenure in all sites
- Timely decision making on property issues via stakeholder forum
- Business cases for property investment decisions
The Client Outcome
Marcus made an obvious and significant difference to ANZ National Bank as its ability to predict its property costs improved significantly, its actual property costs were managed to budget, and its property lease costs reduced by $2.4m over a three-year timeframe.
Loss of sites due to tenure expiry was also minimised.
On top of that, Marcus was instrumental in developing and implementing a successful and profitable sale and leaseback transaction of 16 bank branches in 2009 during the GFC crisis. This was one of the largest property transactions of 2009.