Archive | Cromwell

Cromwell buys half of Oyster, McKellar to chair it

Brisbane-based Cromwell Property Group has acquired a 50% interest in New Zealand property & fund manager Oyster Property Group Ltd.

Cromwell is a larger-scale, ASX-listed version of Oyster, holding an $A2.3 billion property portfolio and running an $A1.2 billion funds management business.

Oyster, formed by Hamilton-based Mark Winter & Heather Coyne in 2004, has $650 million of property assets under management through a combination of 24 private property syndicates and institutional property management mandates, including the 3 Dress-Smart outlets, now owned by Lend Lease Corp.

Mark Schiele.

Mark Schiele.

Oyster chief executive Mark Schiele said yesterday the partnership with Cromwell would enable the company to acquire larger institutional-grade assets over time and to build the scale of the business, as part of its long-term strategy to significantly accelerate growth.

Typically before Cromwell’s arrival, Oyster limited itself to investments up to $25 million. Its next syndicate will be for the NZ Racing Board building in Petone, bought for $10.5 million. Oyster will look to raise $6.7 million from investors, but hasn’t issued a prospectus yet.

Cromwell will acquire a 50% stake in the Oyster business for an initial payment of $5 million, with a further $2.5 million payable over the next 2 years upon achieving targeted financial performance. Outperformance payments are also possible over the same period.

The remaining 50% will continue to be owned by Oyster directors Mr Schiele, Gary Gwynne & Mark Winter, along with fellow shareholders Graeme Edwards, Nigel Powell & John Bougen.

Michelle McKellar.

Michelle McKellar.

Auckland-based Cromwell director Michelle McKellar will chair the new board, which will also include Cromwell funds management director Daryl Wilson and another senior executive, Michael Blake.

Cromwell chief executive Paul Weightman said Oyster had many similarities to Cromwell and would provide a solid platform for the group’s expansion into New Zealand. He said New Zealand’s economic recovery reinforced Cromwell’s already optimistic view about the opportunity to grow its presence in the country.

“Recent economic data suggests New Zealand is entering a new period of strong, sustainable growth. We believe we have the right partner, at the right time, to take advantage of these conditions and build a solid, profitable business.”

Cromwell has historic New Zealand ties – in the 1980s, NZSX-listed Corporate Investments Ltd, headed by Peter Masfen, created an associated listed company, Corporate Equities Ltd, to invest in Australia. Corporate Investments survived, evolving into wine company Montana Group (NZ) Ltd, and Corporate Equities went through a couple of changes before turning into Cromwell with a recapitalisation in 1998. It still has a number of New Zealand based securityholders.

Attribution: Company releases, phone interview, Companies Register.

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Propbd on Q Th6June14 – Cromwell buys half of Oyster, one apartment sells, Barfoot average eases but sales rise

Cromwell buys half of Oyster
One apartment sells at Ray White
Barfoot average eases, but sales well up

4pm:
Cromwell buys half of Oyster

Brisbane-based Cromwell Property Group has acquired a 50% interest in New Zealand property & fund manager Oyster Property Group Ltd.

Cromwell is a larger-scale, ASX-listed version of Oyster, holding an $A2.3 billion property portfolio and running an $A1.2 billion funds management business.

Oyster has $650 million of property assets under management through a combination of 24 private property syndicates and institutional property management mandates, including the 3 Dress-Smart outlets, now owned by Lend Lease Corp.

Michelle McKellar, former CBRE chief in New Zealand and an independent director of Cromwell, will chair Oyster.

One apartment sells at Ray White

One Hobson St apartment was sold under the hammer at Ray White City Apartments’ auction today, but another one just down the street was passed in without a bid. Auction results:

Hobson Heights, 208 Hobson St, unit 2F, sold for $247,000, sales agents James Mairs & Marcus Fava
Oaks on Hobson, 188 Hobson St, unit 105, no bid, Judi & Michelle Yurak

Barfoot average eases, but sales well up

Barfoot & Thompson director Peter Thompson said today the agency’s average price dropped $6000 from April to $702,966 in May.

He said house prices were static in May but the market was more active – 1109 sales, up 37% over April, though 14% down on May last year.

Attribution: Company & agency releases, Cromwell website, Companies Register, auction.

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Brisbane trust with NZ connections promotes new syndicate

Published 28 September 2009

A Brisbane-based property trust with both old & new New Zealand connections is seeking to reignite investment interest from this side of the Tasman.

 

The Cromwell Riverpark Trust’s parent company, Cromwell Corp Ltd, evolved from the reverse takeover of Corporate Equities Ltd, a New Zealand-listed offshoot of Corporate Investments Ltd, both headed by Peter Masfen.

 

Both of the NZ-listed companies succumbed in the 1987 sharemarket crash, although Corporate Equities lingered as a shell with about 600 New Zealanders still on its share register.

 

“They’ve seen their shares go from a dollar to a cent and back again,” chief executive Paul Weightman said.

 

One new connection is Michelle McKellar, former head of real estate consultancy CB Richard Ellis in New Zealand, who’s been a non-executive director of the Cromwell Group for 2 years. Finance director Daryl Wilson is also a New Zealander.

 

The trust has an $A95.15 million bank loan and is seeking a total $A91 million from investors to buy an old gasworks site on Breakfast Creek Rd at Newstead Riverpark, 2km from the Brisbane cbd, and fund construction of the 7-storey Riverpark office building which will be the headquarters of the Queensland Government-owned Energex Ltd.

 

The Green Building Council of Australia awarded the building a 6-star rating last year under version 2 of its office design rating tool.

 

Energex has taken a 15-year lease over 93% of the building from completion, expected to be in July 2010. The 7% balance of the property will be subject to a 5-year lease arrangement with a subsidiary of ASX-listed FKP Property Group, which is also selling the land.

 

The land price is $A15 million and the building value $A158 million for an $A173 million completed value.

 

Investors will be paid monthly at an initial 8.25%, and the trust has a life of 7 years, although Mr Weightman said in recent times Cromwell investors had voted to roll over their investment trusts or seek liquidity, in which case Cromwell would make them an offer.

 

Regulation & tax treatment differ, and the offer document notes there is a currency exchange risk.

 

Mr Weightman said Cromwell had timed the sale of about one-third of its portfolio perfectly, selling off at the top of the market in 2007, which left it about 35% geared. In the downturn, as others have been relinquishing assets, Cromwell has been acquiring.

 

He said Cromwell had attracted New Zealand investors to its syndicates without trying to, but this week would begin the task of rebuilding its New Zealand investor network.

 

“Our business has always been focused on long-term government leases – we’re regarded as a passive investment,” Mr Weightman said.

 

$A65 million of the Riverpark trust’s equity has been sold in Australia and Mr Weightman said Cromwell would be “pretty happy” if it could sell $A10 million in New Zealand. It expects to close the syndicate by the end of the year.

 

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Attribution: Phone interview, product disclosure statement, story written by Bob Dey for the Bob Dey Property Report.

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