Weekend Herald

Kiwis offered big property opportunit­y in Australia

- — Article supplied by Centuria Capital Group

New Zealand investors have an opportunit­y to diversify into the Australian commercial property market with a Centuria Capital Group unlisted single-asset fixed-term fund, secured by a NZ$240million (A$224million) office building in Melbourne.

The Centuria Government Income Property Fund (CGIPF) will acquire the fully leased 20,191sq m A-grade office building located in the inner Melbourne suburb of Footscray.

It has an 11.8-year Weighted Average Lease Expiry (WALE) and 91 per cent of the rental income˘is derived from the Victorian Government and state-owned entities.

Mark Francis, CEO of Centuria NZ (formerly Augusta), said the offering is˘an example of how New Zealand investors can benefit from the size and purchasing power of the ASX-200 listed transtasma­n platform with approximat­ely $A16.8 billion of assets under management.

“The merger of Centuria and Augusta last year enables us to benefit from a larger balance sheet to acquire larger scale assets for our New Zealand property funds as well as provide opportunit­ies for Kiwi investors to diversify into high quality, institutio­nal-grade Australian funds,” Francis said.

The office building at 1 McNab Ave, Footscray, was built in 2014 and encompasse­s nine levels of office accommodat­ion with highqualit­y tenant fit-outs and four levels of secure parking.

It benefits from strong sustainabi­lity credential­s, including 5.5-Star NABERS energy and water ratings and a 5-Star Green Star Rating.

In addition to the strong tenant covenants, all the property’s six leases include fixed annual rental increases of between 3.5 and 4 per cent, which will deliver built-in rental growth.

New Zealand-based investors can participat­e in the CGIPF opportunit­y with a minimum investment of A$50,000.

Bayleys Real Estate’s Syndicatio­n and Investment Products division is marketing the CGIPF offering within New Zealand.

The fund is forecastin­g an annualised pre-tax distributi­on return of˘5.25 per cent for the 2022 financial year, growing to 5.35 per cent the following year, with monthly payments.

Details of the forecast distributi­ons and the risks associated with the investment can be found in the product disclosure statement available at www.centuriain­vestments.co.nz.

Centuria Capital Group joint CEO Jason Huljich said, “Centuria has a 22-year track record for delivering successful fixed-term unlisted funds.

“In this low interest rate environmen­t, there is a strong appetite from retail investors on both sides of the Tasman who are searching for highqualit­y investment­s with compelling yields. This is reflected in the over-subscripti­on of the group’s recent unlisted fundraisin­gs.

“Footscray is benefiting from significan­t infrastruc­ture investment, expansion of government services and high residentia­l demand. This gentrifica­tion is anticipate­d to double the area’s population by 2041.

“In short, 1 McNab Ave is a high-quality asset with strong tenant covenants positioned within an in-demand neighbourh­ood.”

The Victorian Government has identified 1 McNab Ave as the first project in its new government workplace precincts.

It is creating five government work hubs for the Victorian Public Service in metropolit­an Melbourne areas to enable workers to be closer to their homes. The hubs will accommodat­e up to 2380 public servants each week.

So far this year, Centuria NZ has completed two major capital raises in New Zealand. The first was for a single-asset fund which acquired the NZ$178.3 million Visy glass bottling complex in Penrose, Auckland. Additional­ly, it raised $80 million for the Augusta Industrial Fund Ltd (AIF), which provided balance sheet capacity for further acquisitio­ns.

These included a brand-new large-scale A-grade industrial facility in Auckland, a portfolio of eight Auckland industrial properties with eight-year triple net leases, and a welllocate­d modern Christchur­ch warehouse providing a seven-year lease.

These acquisitio­ns will increase AIF’s total portfolio value to more NZ$547 million, spread across 21 properties and 52 tenants.

A small number of shares in Augusta Industrial Fund Ltd are available through Bayleys.

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 ??  ?? The office building at 1 McNab Ave, Footscray, encompasse­s nine levels of office accommodat­ion with high-quality tenant fit-outs and four levels of secure parking.
The office building at 1 McNab Ave, Footscray, encompasse­s nine levels of office accommodat­ion with high-quality tenant fit-outs and four levels of secure parking.

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