Fund expects to acquire six properties
Unlisted commercial property funds manager Property Funds Management Limited (PMG) has fully subscribed to an investment offer to raise $68 million in its flagship fund, Pacific Property Fund Limited (Fund).
PMG chief executive officer Scott McKenzie said the offer is the largest opportunity the company has brought to market to date.
The Fund offers retail investors strong comparable forecast gross cash dividends of 7.35 cents per share per annum paid quarterly. At the current share issue price of $1.22 per share, the figure represents a gross cash return of 6.02% per annum paid quarterly.
“We believe the speed at which the offer was taken up is a direct reflection of the track record PMG and our funds have demonstrated over time, and investors seeking out reliable alternatives to term deposits,” McKenzie said.
“On top of that, the recent restrictions and compliance pressures placed on the residential property investment market highlights the strength, historical resilience and ease of investing in an unlisted commercial property fund like Pacific Property Fund Limited.”
From March 2021 to June 2021, the Fund expects to acquire six properties totalling $128 million (with four of these properties to be acquired using the funds raised from the offer) – with the properties to be acquired including two industrial properties in Christchurch and Wellington, two A-grade and recently built office properties (Anderson Lloyd House and Nexia House) in Christchurch CBD, and two industrial properties in Auckland and Hamilton.
After acquiring these properties, the Fund’s portfolio will consist of 20 commercial properties with 62 tenants, resulting in a total estimated portfolio value of $393 million.
PMG board chairman Denis McMahon commented: “When we established the Fund in 2014, the aim was to grow a robust and diverse Fund which would withstand major economic downturns. I believe that the performance of the Fund through the pandemic in 2020 showed that we have succeeded in doing just that.”
PMG plans to add more investment offerings to the market this year in its five unlisted commercial property funds.
